North Dakota Tops Alaska In Oil Production, Trailing Only Texas

From my colleague Stephen J. Lee of the Grand Forks Herald:

North Dakota passed Alaska in March to become the second-leading state in crude oil production, trailing only Texas, according preliminary figures released Monday.

North Dakota produced an average of 575,490 barrels of crude oil every day in March, another record, according to Lynn Helms, director of the state’s Department of Mineral Resources. The crude is coming from a record 6,636 wells. In February, the state produced 558,255 barrels and had 6,450 wells.

The number of rigs drilling in the state was at 208 on Monday, about where it has been for eight months, including a record 212 drilling for a day or two earlier this month.

North Dakota’s new record output of crude surpassed the steadily declining output of Alaska, which saw its production fall to 567,481 barrels per day in March, down almost 15,000 barrels per day from February, said Stephen McMains of the state’s Oil and Gas Conservation Commission on Monday.

Meanwhile, Texas’ production has been increasing steadily by 12 percent since September, to 1.72 million barrels per day in February, the latest figures available from the U.S. Energy Information Administration, which tracks state and federal crude oil production. Meg Coleman, a geologist with the EIA, said preliminary figures make it appear Texas’ production increased in March.

Fueled by the Bakken boom in the Williston Basin in the western part of the state, North Dakota’s oil production has almost quadrupled since March 2007, when it averaged 118,103 barrels per day.

In December, North Dakota’s crude production eclipsed California for the third ranking. California produced 540,000 barrels a day in February, and it will remain about the same when March figures are released later this month, said Gordon Schremp of the state’s energy commission.

Helms said in an email to the Herald on Monday evening the North Dakota’s figures will be released in full Tuesday, showing March output was right in line with the average monthly increase the past year in daily production of 16,500 barrels. Natural gas production also is at record levels.

But he expects production in April and May may have slowed as weight restrictions imposed on thawing roads slowed down water hauling, which is key for the hydraulic fracturing crews who work on the newly drilled wells to get the oil flowing in the “tight” Bakken and Three Forks formations.

The top four producing states accounted for 55 percent of the nation’s total crude output in February of 6.144 million barrels a day, according to EIA.

Ron Ness, president of the North Dakota Petroleum Council, said he was surprised when told Monday that Alaska’s trend downward already appeared to have dipped below North Dakota’s five-year ascending production.

“Holy cow, I didn’t think it would happen this fast,” he said.

The warm, dry winter in North Dakota was a big contrast to the snowy, cold months Alaska experienced, Ness pointed out.

Alaska has seen decreasing production for decades, since pumping out more than 2 million barrels a day in the 1970s.

The rig count in North Dakota has remained relatively constant for the past eight months or more, Ness said, at 204 to 209 most of the time, including a record high this month of 212 for a day or two.

“I think we are seeing more of a transition from exploration into more of a development phase,” Ness said Monday. “I think we are settled in here where companies are really concentrating on efficiency and running drilling rigs off the pads, so you will see the rig count appears to be stabilized.

“We have seen a lot of companies coming in with new technologies . . . coming in from all over the world,” Ness said.