North Dakota rig counts steady despite steep drop in oil prices

BISMARCK, N.D., Dec. 21 (UPI) -- Despite crude oil prices at or approaching historic lows, North Dakota rig numbers continue to show stability, state data show.

Data from the North Dakota Industrial Commission show a rig count of 64 for Monday, down one from last week. The historical low of 63 was set in November 2009. An all-time high of 218 was recorded in May 2012.

Crude oil prices are at historic lows, with Brent crude oil prices touching their lowest point since 2004 in overnight trading Monday. Brent crude oil is 37 percent lower than it was at this point last year. That leaves energy companies with far less capital to invest on future activity, with companies cutting 2016 budgets by up to 2016.

The trend in oil prices has been mirrored more or less by the trend in rig counts. Data recorded last week by oil field services company Baker Hughes show the rig count in North Dakota at one point dropped to 58. The total U.S. inland rig count of 684 for the week ending Dec. 18 was 62 percent lower than last year. North Dakota's rig count for Monday was 64 percent lower than last year.

North Dakota is the No. 2 oil producer in the nation, behind Texas. Oil production in October, the last full month for which data are available was 1.7 million bpd, slightly higher than the previous month, but lower than the 1.2 million bpd record set in December 2014.

NDIC Director Lynn Helms said in a monthly report published mid-December that companies working in North Dakota shale basins were seeing mixed results as efficiency improves against a backdrop of lower rig counts. A weak oil market is expected to run into next year, however, and cause some slowdown in the state.

"Operators have a significant permit inventory should a return to the drilling price point occur in the next 12 months," he said in a statement.