Pages

Friday, February 28, 2014

How Cold Was It In The Bakken In January? -- So Cold, The Diesel Froze

Reuters is reporting:
Oil production in North Dakota's Bakken shale stayed flat in January after falling sharply the month before, according to independent data that illustrate how this winter's bitter cold put a freeze on the world's fastest-growing oil patches.
Although December's extraordinary chill gave way to relatively warmer weather last month, Bakken output hovered just below 860,000 barrels-per-day, according to calculations by LCI Energy Insight, a Texas-based energy intelligence firm.
In December, Bakken oil production fell by nearly 50,000 bpd from a record just over 910,000 bpd in November, the largest drop since state records began, according to North Dakota Industrial Commission data this month.
The LCI figures, based on historical well production data and natural gas pipeline flows in North Dakota and Montana, are the first to show the full impact of winter weather on oil output, a trend that brought new seasonal uncertainty to oil markets in recent years.
Growth in the larger Eagle Ford shale in south Texas also ground to a halt at around 1.1 million bpd, according to the LCI data, which was made available to Reuters.
Parts of North Dakota had the third coldest December on record, so frigid, according to local papers, that diesel fuel froze in truck tanks. In January, it was the wind that forestalled the drilling and hydraulic fracturing operations that are necessary to keep output growing.
"December was very cold and January was warmer but windy," said Bill Abeling, a meteorologist with the National Oceanic and Atmospheric Administration in Bismarck, North Dakota. Peak wind speeds were above 35 miles per hour for a third of the month in Williston, the heart of the oil boom, Abeling added. 
Although companies often cut back on fracking operations during the winter months due to operational issues, the impact was greater this year due to the severe conditions.
In addition, the weather in the northern Midwest state is wielding a greater influence on the oil market, forcing oil traders to adjust to a new dynamic. U.S. oil markets cannot overlook the loss of 50,000 bpd of Bakken crude just as winter heating fuel demand peaks, traders say. 
Still, it is likely to be a temporary lull in the otherwise upward trajectory of the Bakken region, whose bounty turned North Dakota into the country's No. 2 oil-producing state. Regulators expect the backlog of wells waiting on completion, numbering 635 in December, to be up and running by May.
This is the first of three pages; to see the rest, go to the linked story.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.