Higher Bakken Production Forecast on Better Weather, Completions Increase
The North Dakota Industrial Commission’s July 15 crude oil production report will likely show a production increase of 12 thousand barrels of oil per day (bopd) from April to May, according to energy information provider Genscape.
This production figure would represent a 65,000 bopd increase since the start of 2015 and a 170,000 bopd rise from this time last year, Genscape reported in a July 11 press release.
“The month of May in North Dakota was one of the wettest on record, which likely caused production and completion operations to be slowed,” said Jodi Quinnell, oil product manager at Genscape. “With favorable weather last year, production grew 39,000 bopd from April to May.”
Genscape has seen significant production gains as weather has improved in June and July and completion activity has increased. Over the past two months, 65,000 bopd of production has been added in North Dakota, equivalent to production increases seen over the first five months of 2013.
The company forecasts Bakken crude to keep rising with 127,000 bopd added between May and year-end 2013. Genscape estimates production will reach 1.1 million bopd by the end of 2014.
The tightening of the spread in May between West Texas Intermediate crude and Brent oil prices was the main driver behind the shift of more oil transported by pipeline instead of rail, Genscape noted. In May, 71 percent of Bakken production was transported by rail, and 29 percent was moved by pipeline. In April, 84 percent was moved by rail and 16 percent transported by pipeline.
North Dakota crude oil production, including lease condensate, averaged an all-time high of 770,000 bopd in December 2012, with total annual production more than doubling between 2010 and 2012 thanks to horizontal drilling and hydraulic fracturing activity in the Bakken formation in the Williston Basin, the U.S. Energy Information Administration (EIA) reported March 18 of this year.
The state accounted for 10 percent of U.S. crude oil production, trailing only Texas and the U.S. federal offshore region in production in 2012, EIA reported.
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