DENVER, March 19 (UPI) -- Industry data show the number of rigs deployed in shale-rich U.S. states is a poor indicator of industry health, though government records suggest otherwise.
North Dakota state data show 107 active rigs as of Thursday, down 45 percent year-on-year and 3.6 percent less than last week. The rig count of 111 last week was the lowest since April 2010.
Bentek Energy, a forecasting division of energy reporting agency Platts, found crude oil production in and around the Bakken shale formation in North Dakota averaged 1.2 million barrels per day. That is around 276,000 bpd higher than February 2014, despite the drop off.
"Producers are countering the decline in rig count with a drive for efficiency gains in drilling and completion techniques and an increased focus on their more productive acreage," Catherine Bernardo, Bentek's manager of energy analysis, said in a statement.
Data from the North Dakota Industrial Commission found the 1.19 million bpd produced in January, the last full month for which data are available from the agency, was 2.5 percent less than the all-time high reported in December.
Data in a drilling productivity report from the U.S. Energy Information Administration, meanwhile, finds net production from key shale basins in the United States may slow down in April. Of the seven shale basins reviewed, including Bakken, only the Permian shale in western Texas shows a projected gain.
Bentek, however, finds production from the Eagle Ford shale basin in Texas increased 3.1 percent year-on-year to average 1.6 million bpd. Yet, when combined with the Niobrara shale in Colorado, EIA data show expected production from Bakken and Eagle Ford will drop off by 24,000 bpd by April, which would be the first decline since EIA drilling record-keeping began in 2013.
EIA attributed the drop off in rig deployments to the low price of oil and subsequent spending cuts.
"When producers make the decision to lay down some drilling rigs, they generally start by idling the older, least-efficient ones first," it said in a Wednesday brief. "The effect on production depends on the productivity of the remaining rigs."
