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Fueling the future

Oil, gas permit numbers increasing rapidly

June 6, 2008
By ELOISE OGDEN, Regional Editor,
BISMARCK – Oil activity in North Dakota is stepping up immensely, including on the Fort Berthold Reservation.

Projections are that by the end of this year the North Dakota Oil and Gas Division, the state agency which issues the oil and gas permits, will have issued around 1,100 total permits, said Bruce Hicks, assistant director of the division. He said that number will include re-entry and renewals.

So far this year, the total number of permits issued is 468, including re-entry and renewals, he said.

Hicks said 354 new permits have been issued so far this year. He said that number is more than twice as many as the number of new permits issued in 2007, which was 162 new permits. Hicks said the projections are that the number of new permits issued this year will be “over 800” by the end of the year.

 Currently, 3,931 wells are producing in North Dakota and 392 of them are Bakken wells, Hicks said. As of Thursday, 74 rigs were actively drilling in the state.

Mountrail County is one of the hot play areas in North Dakota.

Hicks said the first horizontal Bakken well drilled in Mountrail County was EOG Resources, Inc’s #1-24H Nelson farms well located in the SESE 24-156-92, which is in Ross Township west of Stanley. The cumulative oil production there through April is 53,036 barrels of oil and daily production in April averaged 30 barrels of oil.

As for Ward County, Hicks said Ward has Bakken and the western portion is underlain by thermally mature Bakken.

“It is a good thing that the western portion of Ward County is underlaid by thermally mature Bakken. This means the Bakken was capable of generating oil production due to sufficient temperature and pressure,” he said.

More details about areas are included in the “Bakken Formation Resource Study Project,” which is available from the N.D. Oil and Gas Division. The study was completed in April.

The Oil and Gas Division regulates the drilling and production of oil and gas in North Dakota. It is a division of the N.D. Mineral Resources Department under the N.D. Industrial Commission.

Fort Berthold Reservation

Oil activity is increasing on the Fort Berthold Reservation.

Marcus Wells Jr., chairman of the Three Affiliated Tribes, said a separate fund has been set up for leasing payments made to the tribe. Those funds will be going for programs including health care, social services, social welfare and economic development, he said.

Once the tribe starts receiving royalties from production, that money will also go into this separate fund which is a Growth Fund, Wells said.

Fred Fox, director of the Tribal Energy Department, said the tribe owns about 204,000 mineral acres and 110,750 acres have been leased so far. That acreage includes land owned by individual land owners. Fox said the companies presently leasing on the reservation include Marathon Oil, Questar, Dakota 3 EMP, Kodiak and EOG.

According to the Office of Special Trust at the Fort Berthold Agency in New Town, more than $60 million in oil and gas leases has been paid to individuals.

The Tribal Energy Department hosted a Fort Berthold Energy Conference and Natural Resource Asset Management Institute in May. Also last month the tribal business council and the Tribal Energy Department held oil and gas general update meetings in Fort Berthold Reservation communities.

The state and the tribe recently agreed on a tax agreement that will streamline the two tax systems into one, which is expected to benefit the production of oil and gas on the reservation. A signing ceremony is planned for Tuesday at 1 p.m. in Tribal Chambers west of New Town.

Article Photos

Eloise Ogden/MDN
A pumping unit operates at a site in the oil field north of Parshall. The Parshall area is one of the busy areas in the oil patch in North Dakota. To date, the N.D. Oil and Gas Division has issued twice as many new oil and gas permits as it did in 2007.



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