ND Crude Oil Production: Bentek Prediction Vs NDIC Monthly Reports -- January 28, 2016

It can be a little confusing to "keep track" of what month of data we are talking about.

The NDIC Director's Cut that comes out every month reports the crude oil production of not the preceding month, but the month before that. The NDIC Director's Cut comes out on/about the 15th of every month, and provides crude oil production of not the preceding month but the month prior to that.

The January 15, 2016, Director's Cut provided crude oil production data for November, 2015. In that report, crude oil production in North Dakota actually increased a bit, month-over-month:

Daily oil production (bopd) as reported by the NDIC:

• November, 2015: 1,176,314 (preliminary)
• October, 2015: 1,171,119 (final, revised) 
• Delta:  5,195/ 1,171,119 = 0.44% increase month-over-month

Yesterday, Platts reported that "shale oil production in the Bakken, Eagle Ford was little changed in December, according to Platts Bentek."

Oil production from the Eagle Ford shale basin in Texas was relatively unchanged in December, increasing about 11,000 barrels per day (b/d), or less than 1%, versus the previous month, the latest analysis showed. This marks the first time since March 2015 that the Eagle Ford shale did not decline. Conversely, crude oil production in the North Dakota section of the Bakken shale formation of the Williston Basin dipped by less than 1% month over month in December, or about 9,000 b/d, continuing the trend of marginal decline that began in the summer.

The average oil production from the South Texas, Eagle Ford basin in December was 1.5 million barrels per day. On a year-over-year basis, that is down about 7%, or about 110,000 barrels per day, from December 2014, according to Sami Yahya, Platts Bentek energy analyst. The average crude oil production from the North Dakota section of the Bakken in November was 1.2 million b/d, about 6% lower than year ago levels.

My understanding is that Bentek's data is based on analysis of many data points.

This was the data from the NDIC Director's Cut:

• November, 2014: 1,188,258 bopd
• December, 2014: 1,227,483 bopd
• November 2015: 1,176,314 bopd (preliminary figures; final figures will be released in February, 2016)

From the linked Platt's article:

• November, 2014: 1,276,596:  (1,276,596 - 1,200,000)/1,276,596 = a 6% decline
• December, 2015: 1,176,314 bopd (NDIC preliminary data for November) - 9,000 bopd (Bentek data, decrease month over month) = 1,167,314 bopd for December, 2015, based on "mixing) NDIC data with Bentek data.

From the linked Platts report, "crude oil production in the North Dakota section of the Bakken shale formation of the Williston Basin dipped by less than 1% month over month in December, or about 9,000 b/d, continuing the trend of marginal decline that began in the summer."

1% of "what" = 9,000 bopd?  9,000 / 0.01 = 900,000 bopd.

Complicating things, of course, is that in the linked Platts article, the numbers are rounded.

We'll just have to wait to see what the NDIC Director's Cut reports on/about February 15, 2016, for the "offiical" ND crude oil production in December, 2015. Bentek says that it will dip "less than 1% month over month, or about 9,000 bopd."

Bottom line: mixing "official" NDIC data on actual production with "predicted" Bentek numbers is very, very confusing. For me, the Bentek numbers are helpful -- as "tea leaves" -- but it's the NDIC numbers that I trust.

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Pricing

On another note, the linked Platts article noted this:

The price of oil out of the Bakken formation at Williston, North Dakota, dropped 16% between January (2016) and December (2015), with an average price of $45.24/b, according to the Platts Bakken  assessment. But when compared to the same month a year ago, the Platts Bakken price is down 35%. The wellhead assessment has ranged between $30.04/b and $59.32/b in 2015.

The Platts Bakken, introduced April 22, 2014, is a daily assessment of price for oil closest to the wellhead prior to determination of transportation by rail or pipe. The assessment reflects a sulfur content of 0.2% or less and an American Petroleum Institute (API) gravity of 42 or less, similar to the nature of North Dakota Light Sweet crude.