Submitted Photo Lynn Helms, director of the North Dakota Department of Mineral Resources, said, “Operators are shifting from running the minimum number of rigs to incremental increases throughout 2017 as long as oil prices remain between $50 a barrel and $60 a barrel West Texas Intermediate.”

North Dakota’s oil production grew from 235,925 barrels of oil a day in January 2010 to an all-time high of 1.23 million barrels of oil a day in December 2014.

Although the state’s oil industry as well as the entire petroleum industry has gone through a decline in production as a result of falling oil prices in the past months, the state continues to produce high numbers of oil and natural gas.

“The Bakken,” the name on North Dakota’s lucrative oil-producing formation, was the 10th oil field in the world’s history to ever reach 1 million barrels of oil a day. It achieved that mark in April 2014.

North Dakota’s Bakken also is one of only three oil fields reaching a million barrels of oil a day located in the United States. The other two U.S. oil fields with that status are in Texas.

The other oil fields with that claim, according to Bakken Oil Business Journal, are:

– Ghawar in Saudi Arabia

– Burgan in Kuwait

– Cantarell in Mexico

– Daqing in China

– Samotlor in Russia

– Kirkuk in Iraq

– Prudhoe Bay in Alaska

– Eagle Ford and Permian, both Texas

Once refined, 1 million barrels of oil is enough to fuel more than 48,200 cars with gasoline and over that many vehicles with diesel, the online publication reported.

In his March report, Lynn Helms, director of the North Dakota Department of Mineral Resources, said oil price weakness is anticipated to last into the second quarter of 2017.

Rigs actively drilling

In January 2010, 81 rigs were actively drilling in the North Dakota oil patch. That number declined in past months due to the drop in oil prices. The number of rigs has been fluctuating but only 38 rigs were actively working in North Dakota in January of this year.

“Operators are shifting from running the minimum number of rigs to incremental increases throughout 2017 as long as oil prices remain between $50 a barrel and $60 a barrel West Texas Intermediate,” Helms said.

On March 10, the North Dakota Division of Oil and Gas, reported 45 rigs were actively drilling in the state. The Oil and Gas Division is a division of the N.D. Department of Mineral Resources that regulates the drilling and production of oil and gas in North Dakota

Helms said the low oil price associated with lifting of sanctions on Iran, a weak world economy and capital movement to the Permian Basin continued to depress drilling rig county.

The Permian Basin lies underneath western Texas and southeastern New Mexico. Late last year, the U.S. Geological Survey announced it estimates the Wolf Camp shale in the Midland Basin portion of Texas’ Permian Basin has 20 billion barrels of undiscovered, technically recoverable oil in the Wolf Camp alone. USGS said this is the largest estimate of continuous oil that it has ever assessed, according to Forbes.

No rigs were actively drilling on federal surface in the Dakota Prairie Grasslands in western North Dakota, according to Helms in his March report.

Fort Berthold Reservation

Fort Berthold Reservation is one of the top oil-producing areas in the state.

Helms said activity on the Fort Berthold Reservation is as follows:

– 10 drilling rigs (two on fee lands and eight on trust lands).

– 187,519 barrels of oil per day (117,099 from trust lands and 70,421 from fee lands).

– 1,582 active wells (1,097 on trust lands and 485 on fee lands).

– 114 wells waiting on completion.

– 507 approved drilling permits (367 on trust lands and 140 on fee lands).

Trust land is land held in trust by the federal government for the beneficial use of an individual Indian landowner or tribe. Fee land is land not held in trust by federal government and the landowner has broader property interest.

Helms said Fort Berthold Reservation has the potential for 1,658 future wells (1,171 on trust lands and 487 on fee lands).

The state had 13,333 (preliminary number) wells producing in January of this year, compared to only 4,628 producing wells in January 2010. The all-time high was 13,520 producing wells in November 2016.

Helms said the estimated inactive well count was 1,678, up 105 from the end of December to the end of January of this year.

He said an estimated 802 wells were waiting on completion, down five from the end of December 2016 to end of January.

More than 98 percent of the drilling now targets the Bakken and Three Forks formations, Helms said.

He said North Dakota leasing activity is limited to renewals and top leases in the Bakken-Three Forks area.

As of January, the most recent figure available, North Dakota produced 1.5 billion cubic feet per day of natural gas. In January 2010, the state was producing 280,589 billion cubic feet per day of natural gas. The all-time high was 1.7 billion cubic feet per day of natural gas produced in November 2016.

Helms said the percentage of gas flared decreased to 12 percent “even with lingering winter weather-related freezing problems.”

“This also resulted in the Tioga gas plant operating at 65 percent of capacity,” Helms said. “The expansion of gas gathering from south of Lake Sakakawea is now starting up, but the crude oil and natural gas liquids transfer lines still have not been approved.”

Flaring

Helms said the January Bakken capture percentage was 89 percent with the daily volume of gas flared from December 2016 to January 2017 down 16 MMCFD. He said the historical high flared percent was 36 percent in September 2011.

Gas capture statistics are as follows:

– Statewide, 88 percent.

– Statewide Bakken, 89 percent.

– Non-Fort Berthold Reservation Bakken, 90 percent.

– Fort Berthold Reservation Bakken, 83 percent. (trust lands, 82 percent, fee lands, 87 percent).

Helms said crude oil take-away capacity remains dependent on rail deliveries to coastal refineries to remain adequate.

The state’s five most oil-producing counties remain as Divide, Dunn, McKenzie, Mountrail and Williams.

Helms said seismic activity is up slightly with five surveys active.

“North Dakota leasing activity is limited to renewals and top leases in the Bakken-Three Forks area,” Helms said.

Improved technology credited for ND’s high oil production

North Dakota is the second top crude oil-producing state in the United States.

An increase of 251 percent in North Dakota oil production from 2010 to 2014 is attributed to horizontal drilling and hydraulic fracturing endeavors in the Bakken shale formation.

“A revised assessment released in 2013 estimated that there are more than 7 billion barrels of technically recoverable oil from the Bakken and Three Forks formations in the Williston Basin; much of that oil is in North Dakota,” said the U.S. Energy Information Administration.

North Dakota crude oil production surpassed 1 million barrels per day in April 2014. The record is the result of increasing crude oil production from the Williston Basin’s Bakken and Three Forks formations in North Dakota and eastern Montana.

Although Bakken oil production initially began in the 1950s at Antelope Field in North Dakota, large-scale production growth did not begin until after the discovery of the Parshall Field in 2007. Since then, advances in drilling methods and technology, a better understanding of the geology of the Bakken, higher crude oil prices, and the formation’s large size and number of wells all have contributed to higher production and to the potential for continued future growth.

As more wells are drilled in the Bakken, the base resource becomes better defined. Because the Bakken has a relatively low thickness (not exceeding 250 feet) and low permeability, better information on the location of available resources can quickly translate into an increase in crude oil production volumes.

Defining the resource in any formation is critical in forecasting the growth and sustainability of its oil and natural gas production. Factors such as the geologic extent, depth, thickness, and porosity of a formation can inform the estimated ultimate recovery rate of wells that are drilled in a formation. EIA uses geologic data to better understand individual well performances and the expected EUR in the Marcellus shale, and plans to expand these efforts over time to include other formations throughout the United States, including the Bakken.

Source: U.S. Energy Information Administration