U.S. Shale Greater Threat to OPEC After Oil Price War
In a corner of the prolific Bakken shale play in North Dakota, oil companies can now pump crude at a price almost as low as that enjoyed by OPEC giants Iran and Iraq. Until a few years ago it was unprofitable to produce oil from shale in the United States. But the steep slide in costs has U.S. shale operators poised to capitalize on Wednesday's decision by the Organization of the Petroleum Exporting Countries to cap output for the first time in eight years.
North Dakota Oil Output Posts Biggest Drop in History
North Dakota's oil output fell the most in history in April, with low crude prices and inclement weather forcing producers to cut back the drilling and fracking of new wells, state regulators said on Wednesday. The output drop highlighted the deep pain spreading through the second-largest oil producing state, with the more than 50 percent drop in crude prices since late 2014 fueling spending cuts and layoffs. The state pumped 1,041,007 barrels of oil per day (bpd) in April…
North Dakota Oil Output Dips Slightly for February
North Dakota's oil output fell 3,000 barrels per day in February, far less than expected as producers brought some wells online to generate cash, the state's energy regulator said on Wednesday. The state's roughly 11,000 active wells pumped about 1,119,100 barrels per day in February, Lynn Helms told a community group in Williston, the state's oil capital. The state reports production on a two-month lag and final numbers are slated to be released on Friday.
North Dakota Oil Output Defies Market
North Dakota's oil production once again defied expectations for a decline in November, even seeing a slight uptick for the second consecutive month, as unusually warm weather helped offset the deepening decline in fracking activity. Production in the second-largest U.S. oil producing state rose by 5,000 barrels per day (bpd) to 1.18 million barrels, monthly data from the Department of Mineral Resources showed. Last month, it also rose 5,000 bpd. Output…
North Dakota Oil Well Backlog Eclipses 1,000 for First Time
The number of oil wells in North Dakota that have been drilled but not fracked eclipsed 1,000 for the first time in September, as producers delayed turning them on in hopes crude prices will soon recover. The milestone, which was widely expected around the second-largest oil producing state, highlights the immense cost pressure companies have come under in the past year as crude prices have dropped more than 50 percent. Fracking alone can account for nearly two-thirds of a well's cost.
North Dakota Well Backlog Nears 1,000
The number of North Dakota oil wells that have been drilled but not fracked rose to an all-time high in August of almost 1,000, as producers delayed bringing them online as long as possible in hopes that crude prices would rebound. It was the latest sign yet that the state's oil industry, the second-largest in the United States, has sharply curtailed spending amid the more than 50 percent drop in oil prices since 2014. North Dakota now has 993 drilled-but-uncompleted wells…
North Dakota to Extend Flare Rules Deadline
North Dakota is poised to give the energy industry up to two extra years to curb the amount of natural gas burned off at oil wells, a move that would ease worries pipeline construction delays make it impossible to meet aggressive flaring standards. Governor Jack Dalrymple and the two other members of the North Dakota Industrial Commission (NDIC), who spent months last year finalizing the rules, will mull oil companies' request for the extension at their Thursday meeting.
North Dakota Oil Output Jumps in May
North Dakota's daily oil production rose 3 percent in May, state regulators said on Friday, hinting that the state's Bakken shale formation may be more resilient to sliding crude prices than expected. The state's well count hit a record high in the month with producers deciding to hydraulically fracture more freshly drilled wells, bucking a trend to mothball them. Drilling permit applications also spiked. "I was surprised by the increase in output for May," said Lynn Helms, head of the state's Department of Mineral Resources (DMR).
North Dakota's Rig Count Bottoms
The drilling rig count in North Dakota's oil patch, a closely watched metric through which many attempt to divine future crude production, appears to have hit a bottom. For the past three weeks the count has hovered between 76 and 79, after sliding only slightly from 80 at the end of May. On June 12, the count hit 76, the lowest level since 2009. The count bobbed slightly in the ensuing days, hitting 77 on Tuesday. It has, in short, been the longest period since oil prices started to slide last fall that the rig count has stayed in the same range…
North Dakota's Train Safety Rules Inadequate
New regulations to cap vapor pressure of North Dakota crude fail to account for how it behaves in transit, according to industry experts, raising doubts about whether the state's much-anticipated rules will make oil train shipments safer. High vapor pressure has been identified as a possible factor in the fireball explosions witnessed after oil train derailments in Illinois and West Virginia in recent weeks. The new rules, which take effect on April 1…
US Shale Firms Brace for More Pain
With the prospect of another plunge in crude prices looming after two months of stability, U.S. shale oil producers may face another round of spending cuts to conserve cash and survive the downturn. A deeper retrenchment would have far-reaching effects. Additional cutbacks would further gut the already-hemorrhaging oilfield services industry and may heighten expectations for a steeper drop in U.S. crude output later this year. They would also reinforce the United States' emerging role as the world's "swing producer…
Bakken Oil Drillers Retreat to the Core
North Dakota's oil producers have pulled back to the core areas of the Bakken formation to cut costs and maximize output amid the slump in prices. The number of active rigs in the state has fallen to just 121, from 190 a year ago, according to an active rig list published by the state's Department of Mineral Resources (DMR) on Wednesday. The rig count is now below the threshold of "at least 130" DMR Director Lynn Helms identified last month as needed to sustain output at the current level of just over 1.2 million barrels per day.
Bakken Oil Wells and the Red Queen's Revenge
More than 22,000 wells have been drilled in North Dakota since oil was discovered in 1951, but over half of state production comes from around 4,000 wells drilled since the start of 2013. By the end of Oct 2014, there were nearly 11,900 wells producing oil and gas in the state. The rest proved dry, or had been shut in or plugged and abandoned as output has dwindled. Of these producing wells, around 70 percent (8,400) are unconventional wells drilled into the Bakken and Three Forks formations…
North Dakota Releases Internal Output Forecast
A stark breakdown from North Dakota projecting how falling oil prices could affect production was formulated using proprietary corporate data and a state official's personal model. Late last Thursday, the Department of Mineral Resources caused a stir in world oil markets by releasing slides from a presentation to the state legislature that included a range of output forecasts based on different oil price scenarios, including one showing production would begin to decline by the middle of this year if crude prices remained at current levels.
Bakken Players Need $55 for Viable Production
North Dakota needs an oil price of around $55 per barrel and a fleet of around 140 rigs to sustain production at the current level of 1.2 million barrels per day, the state's chief regulator told legislators yesterday. Department of Mineral Resources Director Lynn Helms outlined breakeven rates for wells across the state and production projections for a range of prices in a presentation for the House Appropriations Committee of the State Legislature (https://www.dmr.nd.gov/oilgas/presentations/FullHouseAppropriations010815.pdf).
North Dakota Sees Low Cost to Comply with Crude Standard
North Dakota's strict new standards for oil treatment, requiring every barrel of crude be filtered for dangerous types of natural gas, should add 10 cents to the cost of producing every barrel, regulators said on Friday. That's roughly $3.7 million per month, statewide, based on October's monthly oil production of 36.6 million barrels. The new standards take effect in April. The ongoing cost would be in addition to one-time capital investments of $20 million needed statewide…
Can American Indian Reformers Slow Oil Boom?
A change in leadership at an American Indian reservation in North Dakota wouldn't normally get a whole lot of attention. But come Tuesday, the oil industry will be watching this dusty area of the state as two reformers vie to become tribal chairman, an office with outsized power over the course of the state's booming oil industry. That's because the reservation's Three Affiliated Tribes of Mandan, Hidatsa and Arikara (MHA) Nation control roughly a third of North Dakota's oil output.
Flaring Rule Changes Limit N.D. Oil Production Growth
North Dakota's oil production rose less than expected in August due to stringent flaring-reduction standards and sliding oil prices, state regulators said on Wednesday. While production hit an all-time high, some energy companies in the second-largest oil-producing state held back in order to connect new wells to equipment that could process natural gas, a costly step mandated by new regulations. Despite those efforts, flaring rose slightly in August to 27 percent of produced natural gas, reflecting the stark challenge the industry faces.
