North Dakota showing signs of stability as oil production approaches all-time high despite fewer rigs deployed across the state. File Photo by ekina/Shutterstock
BISMARCK, N.D., Aug. 17 (UPI) -- North Dakota's upstream oil and natural gas sector continues to show signs of resiliency in the weak crude oil market, state data show.
State data show 74 rigs actively exploring or producing oil or natural gas in the state. Rig numbers, which serve as a barometer for the health of the energy sector, has been relatively steady in recent weeks in North Dakota. The rig count for Monday is down one from last week and unchanged from Aug. 3.
Lower crude oil prices, down more than 50 percent from one year ago, leave energy companies with less capital available for exploration and production activities. State data show the so-called break-even price, the minimum price at which a project is economically feasible to operate, ranges from $85 per barrel to $25 per barrel.
Nationwide, oil services company Baker Hughes last week reported the total net rig count remained unchanged at 884, though the natural gas rig count dropped two and oil rigs increased by two.
The previous oil rig count from Baker Hughes was up by six from last week's total.
Data from North Dakota show crude oil production in June, the last full month for which the state publishes data, was 1.21 million barrels per day, up about three-quarters of a percent from the previous month and just shy of the all-time record of 1.23 million bpd reached in December.
Marathon Oil in its latest quarterly report said crude oil production from the Bakken shale reserve area of North Dakota had increased year-on-year, attributing the gain to improved efficiency in its shale drilling operations.
Lynn Helms, director of the North Dakota Industrial Commission, said low crude oil prices could act as a mild governor on the state's oil sector.
"Drilling permit activity increased from May to June and again from June to July as operators positioned themselves for low 2015 price scenarios," he said in a statement.