‘Big surge’ expected in oil production this summer

BISMARCK – Oil companies operating in North Dakota are keeping the brakes on this spring, but a “big surge in production” is expected this summer and fall, the director of the Department of Mineral Resources said Tuesday.

Lynn Helms said he expects the drilling rig count will increase from today’s count of 186 to 198 this summer, bringing as many as 2,000 more workers to Oil Patch communities.

Helms said he expects winter weather and spring road restrictions will continue affecting oil production for a few more months.

“It is going to be May, maybe even June, before production seriously gets underway,” Helms said.

Oil production rose 5.6 percent in February to 778,971 barrels per day, according to preliminary figures Helms released Tuesday.

The figure represents a new all-time high for North Dakota, but Helms said the increase was more modest than what he had projected.

“It’s still difficult to operate an oilfield and drill and frac wells in February, even a good February in North Dakota,” Helms said.

The department expects that winter storms will affect oil production in March and April. Helms projects it will take until May before the state hits 800,000 barrels per day.

“They’re keeping the brakes on as they ramp up a little bit this summer,” Helms said.

But once conditions improve, companies are expected to continue increasing their efficiency and drill more wells in less time.

Helms said the industry is proposing more multi-well pads, with seven wells on one location being the most popular number.

“It’s a positive thing because it decreases the footprint, increases the production and allows us to recover more of the Bakken and Three Forks oil,” Helms said.

One location in North Dakota has 14 wells that have been drilled. Helms said he’s signed three orders approving 18 wells on one location and he knows of two proposals that will come before him requesting to drill 24-well pads.

Flaring of natural gas rose about 1 percent in February to 30.4 percent, the second month in a row with an increase. The high was 36 percent in September 2011.

However, there has been huge improvement in the average number of days a well flares, Helms said. In 2007, a typical well flared for 380 days. In 2011, the average was 172 days and in 2012 the average was 51 days, Helms said.

Helms said he anticipates more progress will be made on reducing flaring this summer.

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