Director's Cut: December, 2012, Data

Link here to the NDIC site.

Highlights:

• new all-time highs in production
• more than 400 wells awaiting completion
• new metric: 90 new wells/month needed to maintain current production

Flaring

Additions to gathering and processing capacity are helping with the percentage of gas flared holding at 29%. The historical high was 36% in September 2011.

Oil

• Dec: 768,853 bopd (5% increase over previous month; 3% over previous high)
• Nov: 733,078 bopd (~ 2.0 % decrease; see comments from director below)
• Oct: 747,212 bopd
• Sept: 729,248 bopd
• Aug: 701,409 bopd

Producing wells

• Dec: 8,224  (preliminary) (new all -time high)
• Nov: 8,101
• Oct: 8,035
• Sept: 7,899

Permitting

• Jan: 218 (note the increase)
• Dec: 154 ( significant decrease)
• Nov: 211 (all-time high was 370 in Oct 2012)
• Oct: 370 (all-time high)
• Sept: 273
• Aug: 261

Pricing

• Jan: $88/bbl (note the nice increase)
• Dec: $77/bbl
• Nov: $81/bbl
• Oct: $87/bbl
• Sept: $85/bbl
• Aug: $81/bbl

Rig count

• Jan: 186
• Dec: 184
• Nov: 186
• Oct: 188
• Sept: 190
• Aug: 198

Comments:

• operators were continuing to transition to higher efficiency rigs
• operators still cautious about fracking regulations (SOTU address did not give them any reassurance)
• at end of the year (2012), 413 wells were waiting to be completed (estimate)
• 90 new wells per month to maintain production (estimate)
• takeaway is adequate
• majority of ND oil now shipped by rail to east coast, gulf coast, and west coast
• rig count stable
• drilling permit activity was up significantly in January 
• sufficient permit inventory to accommodate more multi-well pads, the desire to use already built locations during winter, and time required to publish hydraulic fracturing rules if required
• construction of processing plants and gathering systems will be severely affected by weather until the spring thaw
• flaring has held at 29%; historical high was 36% in September 2011
• BLM received over 170,000 comments on hydraulic fracking and has withdrawn "the rule"; a new proposed rule is expected second quarter 2013
• pressure on the federal budget has led to a significant amount of rhetoric from the administration regarding tax treatment of intangible drilling costs and the depletion allowance 

Maintain production:

• new metric: 90 new wells/month required to maintain production
• 185 active rigs x 0.75% --> 140 new wells/month excluding completion
• one rig --> 8 wells/year --> 123 new wells/month/excluding completion
• recent operator stated 38 days well-to-well with one rig -- 365/38 days --> 9.6 wells/year
• in previous reports, NDIC/Director has stated that average time to total depth: < 20 days