North Dakota's oil rig count jumped to 33 in August from 26 in July as operators respond to higher crude prices. State officials expect drilling and well completions to keep accelerating through the second half of the year.
North Dakota's Department of Mineral Resources said oilfield activity is set to increase in the second half of the year as operators add rigs and speed up completions. Elevated oil prices are driving the shift, the department said Thursday.
The state's rig count rose to 33 in August from 26 in July, according to department data. An impasse in the Iran war and disruptions to Middle Eastern supply have kept oil prices elevated, prompting producers to ramp up drilling.
Operators move past DUC wells
According to a Reuters report, Justin Kringstad, executive director of the North Dakota Pipeline Authority, said the added rigs signal operators are moving beyond drilled-but-uncompleted wells, known as DUCs, and expects completions and activity to increase in the second half of the year.
Nathan Anderson, director of the Department of Mineral Resources, said the rig increase this month suggests "operators have two things they are taking advantage of: the short-term increase in prices", or growing confidence the $80 price environment holds for longer. Therefore, some producers appear willing to commit new capital rather than simply complete existing wells.
Prices support the pickup
U.S. crude futures for March delivery traded around $78 a barrel, while Bakken oil delivered at Clearbrook, Minnesota, traded at a premium of $4.39 a barrel to U.S. crude futures.
Source: Commodities & Futures News
Trading involves risk.
Risk Disclaimer
