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North Dakota Passes Oklahoma in Drilling Rigs as Baker Hughes Count Rises
North Dakota overtook Oklahoma this week as the third-most active state in drilling for oil and natural gas, according to data published by Baker Hughes Inc.
The number of North Dakota rigs exploring for and producing oil and gas jumped by two to 128, Baker Hughes said. Oklahoma fell by nine to 123, the biggest drop among the states. Oklahoma is home to the oil delivery hub for the U.S. Midcontinent.
Drilling in the Bakken Shale in North Dakota’s Williston Basin, aided by technical advances in extracting fuel from shale formations, helped make the state the fourth-largest oil producer as of March, behind Texas, Alaska and California, according to data from the Energy Department in Washington. It accounted for 4.6 percent of total U.S. output.
“What you’re seeing is continued interest in producing out of the Bakken,” said Andy Lipow, president of Lipow Oil Associates LLC, a consulting company based in Houston. “There’s been a significant increase in North Dakota, whereas Oklahoma production was virtually unchanged over the past two years.”
North Dakota pumped 251,000 barrels a day on average in March, up 29 percent from the year before and up 74 percent from 2008, according to the Energy Department. Oklahoma output averaged 184,000 barrels a day in March, little changed from 183,000 in 2009 and 186,000 in 2008.
More than 95 percent of North Dakota wells are targeting oil trapped in two hard, impermeable rock formations, Bakken and Three Forks, Lynn Helms, director of the state’s Department of Mineral Resources, said in a July 17 statement posted on the department’s website. Oil and gas flowed to market through 4,893 wells in May, a record for the state, he said.
‘Unconventional’ Field
Bakken “is an unconventional oilfield,” said Gary Flaharty, director of investor relations at Houston-based Baker Hughes. “It’s a new play that because of the advancement in technology is now a viable play.”
The combined U.S. oil and gas rig count rose by one this week to 1,586, the highest level since January 2009. The count touched a 22-year high in 2008, peaking at 2,031.
Oil rigs jumped by 12 to 603, the highest level since January 1991. Gas rigs declined by 10 to 972. Oil rigs constituted 38 percent of the rig total, the highest percentage in 11 years.
Miscellaneous rigs, which primarily drill for geothermal energy, fell by one to 11.
Rigs on land declined by one to 1,556, and rigs in inland waters were unchanged at 14. Offshore drilling increased by two to 16 rigs, echoing the gain in the Gulf of Mexico.
Canadian rigs jumped by 14, or 4 percent, to 363.
To contact the reporter on this story: Margot Habiby in Dallas at mhabiby@bloomberg.net.
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