BISMARCK Despite five months of depressed drilling activity, Lynn Helms, director of the North Dakota Department of Mineral Resources, is optimistic about the future of oil development in North Dakota.

If oil prices stay above $65 a barrel, he said oil activity in the state will soar over the next years with many more wells drilled in the Bakken and Three Forks formations.

Helms said drilling activity dropped for about five months but has been increasing since May.

"Oil companies plan to have 90 to 100 drilling rigs operating by mid-2010 if oil prices hold above $65 a barrel," he said.

On Wednesday, the N.D. Oil and Gas Division, a division of the N.D. Department of Mineral Resources, reported on its Web site there were 65 active drilling rigs in the state.

15,000 new

wells projected

"We project that approximately 15,000 new Bakken and Three Forks wells will be drilled over the next 15 to 20 years and that production will grow to 350,000 barrels per day or higher," Helms said.

Last month a new federal report said North Dakota has leap-frogged over Louisiana and now is the fourth-largest oil-producing state in the country.

North Dakota's oil production accounts for about 2 percent of total U.S. crude oil production, according to the Energy Department.

Only three years ago, in 2006, North Dakota was ranked the ninth-largest oil-producing state.

Texas, Alaska and California are the top oil-producing states, according to the Energy Department.

In December 2008, when Helms spoke in Minot at a meeting of the Minot Area Chamber of Commerce's Energy Committee, he said the focus was on Mountrail, McKenzie and Dunn counties and across Fort Berthold Reservation. At that time he said the oil activity would migrate north in a couple years and then in 2011, would move into Ward, Mercer and McLean counties.

But oil development slowed down for a few months after that prediction.

Here's the schedule before the five-month price drop and slowdown of oil activity. The schedule is based on mineral leases on state land (state land mineral leases expire in five years).

2009: Mountrail, McKenzie, Williams, Divide and Fort Berthold.

2010: Burke, Mountrail, Williams, Divide, Dunn and Fort Berthold.

2011: Mountrail, Dunn, Divide, Burke, Mercer, McLean, Renville and Ward.

2012: McLean, Ward, Renville.

2013: Mercer, McLean, Ward, Renville, Bottineau.

Helms said Nov. 14 that the schedule remains the same, but everything is going to be "pushed out one or two years."

"All of the landmen I have spoken to have been very busy with lease extensions and renewals," Helms said.

"We lost a lot of momentum during the five-month price drop. Export capacity will be full until June 2010, then we should have a little excess capacity for about a year through mid-2011 but the next expansion we will need isn't scheduled until mid-2012.

Helms spoke earlier this month at a meeting of North Dakota Association of Oil and Gas Producing Counties, held in the 4 Bears Casino west of New Town, where he said he also did something new by projecting the oil and gas division's best estimates of how much production will grow for each county.

The information about each county and other details are available at the N.D. Association of Oil and Gas Producing Counties' Web site at (www.ndenergy.org). Once on the site, go to the Annual Meeting for the Oil Counties 2009, then to Powerpoint Presention 2009.