North Dakota Natural Gas Output Hits Record High

Argus Media reports that North Dakota’s natural gas production reached a record high in July 2017, tracking higher crude oil output. Gas production averaged 1.88 Bcfd, 1.3% higher from June and up 10.5% from July 2016, according to the North Dakota Department of Mineral Resources.

July 2017 crude production rose 1.4% compared to the previous month to about 1.05 MMbbld. Almost all the natural gas produced in the state is associated production from oil wells. The actual well completion rate in June was 88, much higher than the 63 reported in August and up from 66 in May. Higher well completions drive production increases.

Lynn Helms, director of the Department of Mineral Resources, noted that well completion numbers have been highly variable amid a lack of experienced crews for hydraulic fracturing. The preliminary well completion number for July is 67. Again, July natural gas production growth was in line with oil production growth. Gas output growth has outperformed crude in prior months as producers have focused in areas with a higher gas-to-oil ratio.

New gas gathering pipelines scheduled to come online this month should keep gas capture rates steady and lead to production increases, added Helms. The number of producing wells in North Dakota in July rose to an all-time high of 13,981. The estimated number of wells waiting on completion at the end of the month rose by 34 from a month earlier to 889. The number of hydraulic fracturing crews currently working in the state has increased and they should be able to complete the number of wells drilled, Helms said. North Dakota has 56 active drilling rigs, down by two from the end of July. The all- time high was 218 rigs in May 2012.

(SOURCE: The Weekly Propane Newsletter, October 2, 2017)