Ala. Admin. Code r. 400-2-2-.02

Current through Register Vol. 42, No. 6, March 29, 2024

Section 400-2-2-.02 - Spacing Of Wells

(1) Each well drilled in search of oil or gas shall be spaced on either (a) a drilling unit or (b) a drainage or production unit. A drilling unit is an administrative unit established by the Board to provide and allow for the drilling of a well. A drainage or production unit is the area in a pool that may be drained efficiently and economically by one well. Prior to the establishment of a field and the establishment of drainage or production units within the field, an operator may drill a well on a drilling unit. Furthermore, with respect to wells drilled in submerged offshore lands, a well may also be drilled on a "drilling unit" or a "drilling and developmentunit." When the Board, after notice and hearing, establishes afield for a pool, special field rules apply for that field. The special field rules designate, among other things, the drainageor production units for the field. Thereafter, wells are drilledon the drainage or production units designated in the special field rules. The term "spacing unit" is used from time to time in these regulations. A spacing unit is either (a) a drillingunit, (b) a drilling and development unit, or (c) a drainage or production unit. For simplicity, the term "production unit" ishereinafter used from time to time in place of the longer term "drainage and production unit." A spacing unit shall not include any part of another unit established for the same pool.

(2) The spacing for a well to be drilled to a pool or pools in an established field shall be governed by special field rules for that particular field. With respect to a well to be drilled to a pool or pools that are not governed by special field rules, the following spacing provisions shall be applicable for drilling and development units and for drilling units within an offshore tract.

(a) Where the operator owns or controls one hundred percent (100%) of working interest in the entire offshore tract, drilling and development units for wells deeper than six thousand (6,000) feet true vertical depth (TVD) may be permitted on an entire offshore tract, three-quarter (3/4) offshore tract, or one-half (1/2) offshore tract. Offshore tract lines may be projected across land areas to determine the appropriate unit boundaries. More than one well may be permitted on a drilling and development unit; however, no production except for testing can occur until unit operations are approved or until special field rules establishing appropriate production units are approved by the Board.

(b) Where the operator owns or controls one hundred percent (100%) of working interest in the entire offshore tract, drilling and development units for wells six thousand (6,000) feet true vertical depth (TVD) or shallower may be permitted on a one-half (1/2) offshore tract, or one-quarter (1/4) offshore tract. Offshore tract lines may be projected across land areas to determine the appropriate unit boundaries. More than one well may be permitted on a drilling and development unit; however, no production except for testing can occur until unit operations are approved or until special field rules establishing appropriate production units are approved by the Board.

(c) Drilling units for wells deeper than six thousand (6,000) feet true vertical depth (TVD) will be permitted on aone-quarter (1/4) offshore tract for regular offshore tracts. For irregular offshore tracts where regular one-quarter offshore tract units cannot be established, a drilling unit comprising up to fourteen hundred (1,400) acres may be permitted. Offshore tract lines may be projected across land areas to determine the unit boundaries. No production except for testing can occur until unit operations are approved or until special field rules establishing appropriate production units are approved by the Board.

(d) Drilling units for wells six thousand (6,000) feet true vertical depth (TVD) or shallower will be permitted on a quarter-quarter offshore tract for regular offshore tracts. For irregular offshore tracts where quarter-quarter units cannot be established, a drilling unit comprising up to three hundred sixty (360) acres may be permitted. Offshore tract lines may be projected across land areas to determine the unit boundaries. No production except for testing can occur until unit operations are approved or until special field rules establishing appropriate production units are approved by the Board.

(e) Wells to be drilled deeper than six thousand (6,000) feet true vertical depth (TVD) shall be located at least one thousand three hundred twenty (1,320) feet from every exterior boundary of the drilling and development unit or drilling units, and no closer than five hundred (500) feet from the State/Federal boundary. Wells to be drilled six thousand (6,000) feet TVD or shallower shall be located at least six hundred sixty (660) feet from every exterior boundary of the drilling and development units or drilling units, and no closer than five hundred (500) feet from the State/Federal boundary.

(f) The Board may approve a drilling and development unit or drilling unit consisting of portions of offshore tracts equal to an entire offshore tract, a three-quarter offshore tract or a one-half offshore tract, where it is shown, after notice and hearing, and the Board finds that a well located at a regular location on an offshore tract would cause the drilling of unnecessary wells.

(3) With respect to a well to be drilled to a pool or pools that are not governed by special field rules, the following spacing provisions shall be applicable for drilling units within submerged offshore lands that are not within an offshore tract.

(a) A well may be drilled on a drilling unit consisting of a governmental quarter-quarter section (approximately 40 acres). Such well shall be located at least three hundred thirty (330) feet from every exterior boundary of the drilling unit.

(b) A well may be drilled on a drilling unit consisting of a governmental quarter section (approximately 160 acres). The Supervisor may require written justification for the drilling unit. Such well shall be located at least six hundred sixty (660) feet from every exterior boundary of the drilling unit.

(c) A well to be drilled in search of gas in the Counties of Baldwin or Mobile may be drilled on a drilling unit consisting of a governmental section (approximately 640 acres). The Supervisor may require written justification for the drilling unit. Such well shall be located at least one thousand three hundred twenty (1,320) feet from every exterior boundary of the drilling unit. The operator shall designate on the permit application an alternate one hundred sixty (160) acre drilling unit, and the well shall be located at least six hundred sixty (660) feet from every exterior boundary of the alternate unit. If said well is completed as an oil well, then the spacing for the well shall automatically revert to the designated alternate one hundred sixty (160) acre drilling unit until the proper spacing for said well is determined by the Board after notice and hearing.

(d) The Supervisor, upon receipt of written justification from an operator, may approve a permit application under sections (3)(a) through (3)(c) above for a well to be drilled on a drilling unit consisting of approximately 40, 160, or 640 contiguous surface acres other than a governmental section or division thereof as set forth herein.

(e) The Supervisor may require that a well to be drilled on a drilling unit contiguous with an existing field be drilled and completed as an extension of the field, in accordance with spacing provisions in the special field rules thereof. If, however, an operator provides written justification that such proposed well will likely be completed in a pool or pools not defined in the special field rules for said field, the Supervisor may approve the drilling and completion of such well in compliance with the spacing provisions as set forth herein.

(f) No well shall be drilled within two hundred (200) feet of any permanent residence, unless otherwise approved by the Board.

(4) Pursuant to Section 9-17-12(c) of the Code of Alabama (1975), the Board may grant an exception to the spacing rules as may be reasonably necessary where it is shown, after notice and hearing, and the Board finds that the unit is partly outside the pool, or for some other reason, a well located in accordance with applicable rules would be nonproductive, would not be at the optimum position in such spacing unit for the most efficient and economic drainage of the unit, or where topographical conditions are such as to make the drilling at an authorized location on the unit unduly burdensome or where an exception is necessary to prevent confiscation of property. Provided, however, that an exceptional location order issued by the Board for a well shall expire one (1) year from the date of issuance of the order unless a well has been spudded at said exceptional location.

Ala. Admin. Code r. 400-2-2-.02

Filed September 30, 1982. Repealed and New Rule: Filed April 11, 2000; effective May 16, 2000. Amended: Filed July 6, 2010; effective August 10, 2010.

Author: Marvin Rogers

Statutory Authority:Code of Ala. 1975, §§ 9-17-1, etseq.