North Dakota oil output up in June; slow growth expected to continue

North Dakota oil production increased 3.5% in June and is expected to continue slowly climbing for the rest of 2022 and beyond.

That was the word Tuesday from Lynn Helms, head of North Dakota's mineral resources department.

North Dakota churned out 1.1 million barrels of oil per day in June, up from 1.06 million in May. Output was somewhat less than forecast due to production shortfalls in one county, Helms said.

However, the state's natural gas production jumped 9.7% in June from the previous month to 3.06 million MCF per day. (An MCF is 1,000 cubic feet of natural gas.)

The strong increase was driven by historically high U.S. natural gas prices, Helms said.

The number of drilling rigs — a harbinger of future production — has been rising during the summer. The rig count stands at 47, up from 42 in June and July.

Another positive sign for increased production, Helms said, is a significant drop in inactive oil wells. With high oil prices, "we are seeing these inactive wells being put back on," he said.

Helms forecast that North Dakota oil production would gradually move up from 1.1 million barrels per day to 1.2 million barrels by the end of this year or in 2023's first quarter.

That's still well short of the state's record production of 1.52 million barrels per day in November 2019.

The Permian Basin in Texas and New Mexico, the largest U.S. shale oil producing region, surpassed its pre-pandemic output several months ago. The U.S. Energy Information Administration expects the Permian to post record oil production in September.

North Dakota is far behind that pace of recovery.

In a video conference with reporters, Helms was asked if North Dakota's oil production had peaked. He replied that by the end of the 2020s, the state can achieve and sustain oil production levels of 1.4 million barrels per day.