Oilfield deals cut budgets and oil and gas drilling, North Dakota official says

Oilfield deals cut budgets and oil and gas drilling, North Dakota official says
Oilfield deals cut budgets and oil and gas drilling, North Dakota official says

Oil and gas deals are cutting drilling budgets in North Dakota, the United States’ third-largest oil-producing state, and risk eroding future production, a state official said Friday.

North Dakota’s production fell 2,000 barrels per day (bpd) to 1.13 million bpd in May from April, according to data from the state’s Industrial Commission, which oversees oil and gas resources. .

“Growth is slower than you might think with a barrel of oil at $74,” said Lynn Helms, director of the North Dakota Department of Mineral Resources (DMR).

Mergers and acquisitions disrupt budgets and impact rig counts, Helms told a news conference.

According to data from Baker Hughes, the rig count, an indicator of future production, has averaged 35 so far in July, flat on the previous month, as prices increased by 5%.

West Texas Intermediate crude oil futures settled at $75.42 on Friday, buoyed in recent weeks by production cut plans by major producer Saudi Arabia.

Bakken light sweet crude was trading at a premium of $2.56 to U.S. crude futures, according to DMR.

Last month, Chord Energy Corp agreed to buy assets in the Williston Basin, which spans North Dakota, South Dakota and Montana, from Exxon Mobil for $375 million.

In April, Ovintiv agreed to sell its assets in North Dakota’s Bakken to privately held Grayson Mill Bakken for about $825 million, while Houston’s Kraken Oil and Gas last year acquired all of the interests. of Bowline Energy in the pits. (Reporting by Arathy Somasekhar in Houston; writing by Will Dunham)

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