Director's Cut -- November 8, 2011 -- The Bakken, North Dakota, USA

Link here.

Production hits all-time high in North Dakota (again):
Aug, 2011, oil: 444,142 bopd
Sep, 2011, oil: 464,122 (preliminary, all time high)

Aug producing wells: 5,951
Sep producing wells: 6,071 (all-time high)

Permitting
Aug, 2011: 207
Sep, 2011: 176 (all time high: 245, 2 Nov 10)

Pricing
Sept, 2011: sweet crude, $83.50
Aug, 2011: sweet crude, $81.43
Jul, 2011: sweet crude, $90.60

Back of envelope calculations:
Sept, 464,122 x $83.50 =  $38.754 million
Aug, 444,142 x $81.43 = $36.166 million
July, 423,550 x 90.60 = $38.373 million
June 384,809 x 91.69 =$35.283 million.

Director's comments:

Rig count remained steady, but production increased 4 percent due to high levels of frack activity. Bowman County Red River production was stable at about 27,000 bbls with one well drilling. The idle well count increased again to 762 wells, approximately 300 above the normal 450, indicating that drilling continues to outpace fracturing services and a need to add approximately 10 crews.

EPA
The efforts to regulate hydraulic fracking under the safe drinking water act are increasing with EPA now looking at using the diesel fuel provision in the 2005 energy policy act.

Rigs
20,000-foot capable rigs: over 95% utilization rates (last month >90%)
7,000 or less-capable rigs: less than 50% utilization rates

Permitting is below record levels. As fall approaches and the rig count rises permit activity is expected to increase so locations can be built prior to winter weather.

The number of wells drilling on federal surface in the Dakota Prairie Grasslands is down to 3.

With regard to flaring:
Daily natural gas production is up; processing plant and gathering system construction activity is very high. North Dakota shallow gas exploration is not economic at the current price. The oil to gas ratio is 26 to 1, but the BTU ratio is 6 to 1. The Bakken play gas has been flared at record levels in order to promote the resource to the natural gas gathering and processing industry and demonstrate the size and potential of this resource. The result is a plan presented by industry to invest over $3 billion in natural gas gathering and processing infrastructure in western North Dakota in 2011, 2012, and 2013.