For the first time since the outbreak, the Montana oil industry is experiencing renewed activity.
In August, they set up two drilling rigs in eastern Montana. Both are horizontal bars aimed at crude oil and gas production. It has been more than 16 months since Montana reported any gas station operations on the west bank of the Wilson Basin.
“It’s all about economics,” said Allan Olsen, general manager of the Montana Petroleum Association. From $ 65 – $ 70 barrel fuel prices, that creates some interest automatically, we are bright.
News of Montana’s renewed activity is included in this month’s oil production report from the North Dakota Department of Minerals.
As of May, Montana was producing 46,425 barrels of oil a day, down from 50,140 barrels a day in January. By comparison, North Dakota produced 1,128,042 barrels per day that month.
Olsen also praised the Montana Digging Incentive Tax rate for inspiring the latest level of activity. The state of Montana provides tax breaks for producers for the first 12 to 18 months to promote new exploration and production.
Across the border from North Dakota, oil activity in Buccaneer was relatively flat during the summer.
“He’s a sleeping giant,” said Lynn Holms, director of the North Dakota Minerals Department. “The Kovi epidemic has put the industry to sleep, and it is struggling to wake up.”
North Dakota Crude oil production changed only 143 barrels a day in May, one of the smallest changes the helm can remember.
“We thought it was flat last month, but this month it is still flat,” Helms said.
During a briefing by the director in August, Helms said the industry in Bacon had the potential to produce more than 1.5 million barrels a day, but operators were conservative.
“Operators are being severely disciplined,” said Helms. They are paying off debts, buying shares and repaying investors, ”he said. It seems that we will not see an increase in the number of regs until next year.
Helms said he expects to see a few X-rays in the third and fourth quarters this year.
“That still brings us to 25 regs,” says Hales. We have to see 60 drills done at this price of oil, it will be economical to dig and complete that many wells.