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Oil production in North Dakota may have exceeded an all-time high in January as mild weather and lower-than-normal snowfall allowed drilling to increase, according to a report.



The number of wells spudded rose to 212 in January from 181 in December and 140 a year earlier, according to a preliminary estimate from Alison Ritter, a spokeswoman for the North Dakota Department of Mineral Resources.

“A lot of people are going to be blindsided by fundamentals and an increase in oil production,” Hamza Khan, an analyst with Schork Group in Villanova, Pennsylvania, told Bloomberg. “Production will increase and prices will fall.”

The state’s output reached a record of 535,036 barrels per day in December as improved technology has made it profitable for producers to tap crude trapped in tight underground shale and other tight formations.

The Bakken tight-oil play, which extends south from Canada into North Dakota, South Dakota and Montana, is the largest contiguous oil deposit in the continental US.

Temperatures in December and January were 12 to 14 degrees Fahrenheit higher than the previous year, said Matt Rogers, president of Commodity Weather Group in Bethesda, Maryland.

Temperatures in February ranged 4 to 10 degrees above normal. North Dakota has received 25 inches less snow than normal, he told Bloomberg.

“They’ve had very little snowpack this year,” Rogers said, noting that winter storms are forecast for the region this week. “There may be a last gasp here, but it has been much warmer than normal.”

As of 28 February, 205 rigs were drilling in North Dakota compared with an average of 167 in February 2011, according to the Industrial Commission of North Dakota, Oil & Gas Division website.

The state’s oil production has quadrupled since 2005, with average output rising to 418,426 bpd in 2011 compared with 97,435 bpd in 2005, according to data from the Industrial Commission of North Dakota’s Oil & Gas Commission.

“The Bakken production has probably exceeded anyone’s forecast,” Andy Lipow, president of Lipow Oil Associates in Houston, told Bloomberg.

North Dakota production eclipses Ecuador's

Bakken production: Growing by leaps and bounds

related stories

Kathrine Schmidt and news wires

18 January 2012 04:16 GMT

Thanks to ramped-up drilling in the Bakken Shale, North Dakota in November increased production to 510,000 barrels per day, a higher output than Ecuador, Opec's smallest member.

November's production figures represented the first time the state passed the half-million barrel-per-day mark, North Dakota's oil and gas division said in a news release.

That represents an increase of 22,000 bpd from the month before and more than 150,000 bpd than a year ago.

“This is big news for the state and the country," Lynn Helms, director of the state agency, said in a statement. "A half a million barrels a day represents about 10% of US production."

Total US production was about 5.8 million bpd as of October, according to the Energy Information Administration.

But field crews are in short supply with "hundreds" of wells awaiting hydraulic fracturing, Helms told Bloomberg.

The number on hold is “constant” at about 300 above normal after mild weather during the fourth quarter allowed drillers to accelerate work, she told the news wire.

“This indicates that fracturing services are now keeping up with drilling activity, but the industry needs to add more crews to catch up,” Helms said in an e-mail today.

Helms said new drilling rigs will need to be built to meet expanding North Dakota demand because 95 percent of the equipment in the region capable of drilling 20,000 feet (6,100 meters) underground is booked.

There were 202 rigs operating in the state today, close to the record high of 204 recorded on 19 November, Helms said.

By comparison, Texas yielded an average of about 1.08 million barrels per day in October 2011, according to the state’s regulator.

After Ecuador, which produces about 476,000 bpd, Qatar is the next-largest producer at 773,000 bpd and Saudi Arabia is its largest producer at 8.1 million bpd, according to OPEC.

Oil producers including EOG Resources and Continental Resources have spurred a five-fold increase in North Dakota’s oil output by using intensive drilling practices to tap the Bakken, a geologic formation that stretches from southern Alberta to the northern US Great Plains, Bloomberg reported.

According to the news wire, the formation is estimated to hold as much as 4.3 billion barrels of tecnically recoverable oil in North Dakota and Montana, according to a 2008 report by the US Geological Survey.

In the Bakken formation alone, crude production rose 56% in November to 443,425 barrels a day from a year earlier, state figures showed.

Bakken oil accounted for 87% of the state’s total November output.

Continental, the Enid, Oklahoma-based oil company controlled by billionaire Harold Hamm, is the largest leaseholder in the Bakken shale region, with 901,000 acres, based on third-quarter 2011 data compiled by Bloomberg Industries.

Hess Corp. of New York and Denver-based Whiting Petroleum Corp. are second and third with 900,000 acres and 680,000 acres, respectively.

Thanks to ramped-up drilling in the Bakken Shale, North Dakota in November increased production to 510,000 barrels per day, a higher output than Ecuador, Opec's smallest member.

November's production figures represented the first time the state passed the half-million barrel-per-day mark, North Dakota's oil and gas division said in a news release.

That represents an increase of 22,000 bpd from the month before and more than 150,000 bpd than a year ago.

“This is big news for the state and the country," Lynn Helms, director of the state agency, said in a statement. "A half a million barrels a day represents about 10% of US production."

Total US production was about 5.8 million bpd as of October, according to the Energy Information Administration.

But field crews are in short supply with "hundreds" of wells awaiting hydraulic fracturing, Helms told Bloomberg.

The number on hold is “constant” at about 300 above normal after mild weather during the fourth quarter allowed drillers to accelerate work, she told the news wire.

“This indicates that fracturing services are now keeping up with drilling activity, but the industry needs to add more crews to catch up,” Helms said in an e-mail today.

Helms said new drilling rigs will need to be built to meet expanding North Dakota demand because 95 percent of the equipment in the region capable of drilling 20,000 feet (6,100 meters) underground is booked.

There were 202 rigs operating in the state today, close to the record high of 204 recorded on 19 November, Helms said.

By comparison, Texas yielded an average of about 1.08 million barrels per day in October 2011, according to the state’s regulator.

After Ecuador, which produces about 476,000 bpd, Qatar is the next-largest producer at 773,000 bpd and Saudi Arabia is its largest producer at 8.1 million bpd, according to OPEC.

Oil producers including EOG Resources and Continental Resources have spurred a five-fold increase in North Dakota’s oil output by using intensive drilling practices to tap the Bakken, a geologic formation that stretches from southern Alberta to the northern US Great Plains, Bloomberg reported.

According to the news wire, the formation is estimated to hold as much as 4.3 billion barrels of tecnically recoverable oil in North Dakota and Montana, according to a 2008 report by the US Geological Survey.

In the Bakken formation alone, crude production rose 56% in November to 443,425 barrels a day from a year earlier, state figures showed.

Bakken oil accounted for 87% of the state’s total November output.

Continental, the Enid, Oklahoma-based oil company controlled by billionaire Harold Hamm, is the largest leaseholder in the Bakken shale region, with 901,000 acres, based on third-quarter 2011 data compiled by Bloomberg Industries.

Hess Corp. of New York and Denver-based Whiting Petroleum Corp. are second and third with 900,000 acres and 680,000 acres, respectively.

Thanks to ramped-up drilling in the Bakken Shale, North Dakota in November increased production to 510,000 barrels per day, a higher output than Ecuador, Opec's smallest member.

November's production figures represented the first time the state passed the half-million barrel-per-day mark, North Dakota's oil and gas division said in a news release.

That represents an increase of 22,000 bpd from the month before and more than 150,000 bpd than a year ago.

“This is big news for the state and the country," Lynn Helms, director of the state agency, said in a statement. "A half a million barrels a day represents about 10% of US production."

Total US production was about 5.8 million bpd as of October, according to the Energy Information Administration.

But field crews are in short supply with "hundreds" of wells awaiting hydraulic fracturing, Helms told Bloomberg.

The number on hold is “constant” at about 300 above normal after mild weather during the fourth quarter allowed drillers to accelerate work, she told the news wire.

“This indicates that fracturing services are now keeping up with drilling activity, but the industry needs to add more crews to catch up,” Helms said in an e-mail today.

Helms said new drilling rigs will need to be built to meet expanding North Dakota demand because 95 percent of the equipment in the region capable of drilling 20,000 feet (6,100 meters) underground is booked.

There were 202 rigs operating in the state today, close to the record high of 204 recorded on 19 November, Helms said.

By comparison, Texas yielded an average of about 1.08 million barrels per day in October 2011, according to the state’s regulator.

After Ecuador, which produces about 476,000 bpd, Qatar is the next-largest producer at 773,000 bpd and Saudi Arabia is its largest producer at 8.1 million bpd, according to OPEC.

Oil producers including EOG Resources and Continental Resources have spurred a five-fold increase in North Dakota’s oil output by using intensive drilling practices to tap the Bakken, a geologic formation that stretches from southern Alberta to the northern US Great Plains, Bloomberg reported.

According to the news wire, the formation is estimated to hold as much as 4.3 billion barrels of tecnically recoverable oil in North Dakota and Montana, according to a 2008 report by the US Geological Survey.

In the Bakken formation alone, crude production rose 56% in November to 443,425 barrels a day from a year earlier, state figures showed.

Bakken oil accounted for 87% of the state’s total November output.

Continental, the Enid, Oklahoma-based oil company controlled by billionaire Harold Hamm, is the largest leaseholder in the Bakken shale region, with 901,000 acres, based on third-quarter 2011 data compiled by Bloomberg Industries.

Hess Corp. of New York and Denver-based Whiting Petroleum Corp. are second and third with 900,000 acres and 680,000 acres, respectively.

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