North Dakota's oil production fell a bit in November, though natural gas output rose a tad, adding up to a flat month overall.
"Steady, this is what we were expecting," said Lynn Helms, director of North Dakota's Department of Mineral Resources. "There was essentially no change."
North Dakota, the nation's second-largest oil-producing state after Texas, pumped out 1.2 million barrels of crude per day in November, down a half-percent from the previous month.
Gas production rose 0.2%, according to data released Friday by the state's mineral resources department.
As for the oil outlook, Helms said he doesn't see production rising appreciably for all of 2021.
For the winter, "we are probably going to see some downward trend in production," he said.
"On the other hand, prices are significantly better."
West Texas Intermediate, the benchmark price for U.S. crude, stood at an average of $41 per barrel in November and $47 in December, according to a report by the mineral resources department. But WTI was trading around $52 Friday.
At that price, oil-field operators are able to economically frack drilled, but uncompleted, wells, Helms said. The fracking process frees the oil.
However, North Dakota's bitter winter usually leads to a downturn in fracking regardless of price.
For new wells to be drilled in North Dakota, WTI needs to be in the $55 to $60 per barrel range, Helms said.
If the state's crude output is to increase, oil companies must drill and frack new wells since production from existing wells naturally declines.
After the coronavirus pandemic decimated global oil demand, North Dakota's crude production fell to a seven-year low in May of only of 858,400 barrels per day. Output then rallied over the summer as oil prices recovered a bit and shut-in wells were reopened.
Mike Hughlett • 612-673-7003
