North Dakota Posts Surprising Jump In Oil Output In March
WILLISTON, N.D., May 13 (Reuters) - North Dakota posted a surprising jump in oil and natural gas output in March, as producers leaned on newer technologies and processes to offset a slump in commodity prices.
Many industry observers had expected output to fall for the third consecutive month in the wake of a more than 50 percent drop in oil prices since last summer.
"We scratched our heads in the month of March" as to why production increased, Lynn Helms, director of the state's Department of Mineral Resources, said during a conference call with reporters.
Yet the increase shows producers' willingness to wring efficiencies out of existing operations, as well as their attempt to maintain production, even at depressed prices, to safeguard relationships with service providers ahead of any future spike in crude oil prices.
About 189 North Dakota wells were completed in March at locations owned by Exxon Mobil Corp, Hess Corp, Continental Resources Inc and ConocoPhillips, reversing a trend in which most producers delayed completions.
"These four appear to be more in tune with having normal cash flow, and continue to complete their wells in a more aggressive manner," Helms said.
But in a sign of divergent strategies in the No. 2 U.S. oil producing state, EOG Resources Inc and Marathon Oil Corp continue to delay fracking.
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