Oil in the Bakken may be making a comeback that will surprise many and it may be more than some might wish, Lynn Helms, director of North Dakota’s Department of Mineral Resources, is being reported as proclaiming this past week. While the process is slow, the numbers are building up, according to Helms, who believes that his department’s projections of 65,000 wells ultimately being drilled in the Bakken remains on target, and it may happen sooner than what Middle East’s OPEC (Organization for the Petroleum Exporting Countries) might wish.
The fact that half of the projects – 32,000 wells — are already in progress or in the process of being permitted contributes to the confident prediction Helms made before members of North Dakota’s Oil and Gas Producing Communities annual meeting. (The organization approved a name change to West Dakota Energy Association.)
Some of the developments being pursued by oil companies could be game-changers, said Helms.
Helms presented three possible price scenarios, including “a price shock scenario,” in which oil prices would jump to $75 and $80 ranges. A more likely, scenario would be that oil remains at about $45 a barrel through most of 2017, and then increasing to $55 in 2018 and $65 in 2019, as rig counts increase incrementally from 30, to 50 and 70 respectively.
An unlikely scenario was also researched in which the price would stay lower for a longer period, but even then the core of the Bakken wouldn’t be exhausted for ten years. That’s good, said Helms, because it means “We have a really strong base to build from.”
Helms predicted a return of transient workers in 2019 or 2026 depending on which scenario evolves.
“I think this downturn in oil prices has been fairly good for the west. It hasn’t been great for the state budget, but it has been good for the west to kind of recoup and get ready for the next wave,” said Vicky Steiner, Outgoing Executive Director of the NAOGPC. The resulting slowdown has allowed impacted communities to catch up with infrastructure needs – issues that must be addressed to allow future development.
- Written by Press Room