North Dakota output above 1mn b/d through 2016

OREANDA-NEWS. September 11, 2015. Crude production in North Dakota should stay above 1mn b/d through 2016 even with wellhead prices between \\$20-\\$30/bl, the state's Department of Mineral Resources said today.

In that pricing scenario, production should decline from 1.2mn b/d this year to about 1.1mn b/d in 2016 and then drop to 935,000 b/d in 2017.

With wellhead prices between \\$20-\\$30/bl rig counts would fall sharply from 75 this year to 30 in 2016.

The production forecast was part of an annual address by the department's head, Lynn Helms, to the North Dakota Association of Oil and Gas Producing Counties.

The data included estimates under various price scenarios. If North Dakota wellhead prices rise to \\$60-\\$70/bl, production in the state should remain at about 1.2mn b/d through 2016.

Current breakeven prices for four North Dakota counties are between \\$20-\\$30/bl, including Dunn, McKenzie, McLean and Billings counties, according to state officials.

North Dakota is home to the Bakken formation, the third most productive US shale field. Crude production has grown sharply from about 150,000 b/d in 2008 to more than 1.2mn b/d, creating a major supply basin which has changed US market dynamics.

So far this year, producers in North Dakota have offset a fall in rig counts with greater efficiency and a backlog of uncompleted wells, leading to continuing robust production in both crude and natural gas. In 2009, each rig in the state drilled 8-10 wells per year, while in 2015 and 2016 that figure is expected to improve to 20-24 wells per rig per year.