Department of Mineral Resources report shows production in North Dakota fell approximately 58.5 MBOEPD in August
The slow rise in oil and gas prices has not been able to stop the continued decline of production in North Dakota, according to the Department of Mineral Resources. The department released its Director’s Cut for October, which covers production data from August, which showed both oil and natural gas production were down for the month. Crude oil production fell roughly 48.7 MBOPD in August from July, while natural gas production fell approximately 9.8 MBOEPD month-over-month, according to the report.
Declining production came in spite of an increased number of producing wells and well permits, the DMR reported.
Producing wells increased to 13,289 in August from 13,265, an all-time high, according to the report. Permitting in August increased to 99 drilling and 1 seismic from 86 drilling permits and 0 seismic in July. Permitting dropped sharply in September to 63 drilling permits and 1 seismic, however, according to the Director’s Cut, which releases an additional month of data concerning permits and rig counts in the state.
The rig count rose month-over-month in both August and September from 31 in July, 32 in August, and 34 last month. “Operators remain committed to running the minimum number of rigs while oil prices remain below $60 per barrel WTI,” the report commented.
Over 98% of drilling now targets the Bakken and Three Forks formation, according to the Department of Mineral Resources.
“Low oil price associated with lifting of sanctions on Iran, a weak economy in China, and the Brexit are expected to lead to continued low drilling rig count. Utilization rate for rigs capable of 20,000+ feet is 25-30% and for shallow well rigs (7,000 feet or less) 15- 20%,” the department said in its report.
“Drilling permit activity increased from July to August then dropped sharply August to September. Operators have a significant permit inventory, should a return to the drilling price point occur in the next 12 months.”
