Rig count in North Dakota hits new low

Though December oil production was at an all-time high, rig activity in North Dakota is on the decline, state data released Monday show.
The North Dakota Industrial Commission reported 137 active drilling rigs in service in the state as of Monday, a 26 percent decline from the same date in 2014 and 31.5 percent less than the historic peak reached in 2012. The rig count for Monday is the lowest in five years.
Oil prices have declined to the point that most energy companies have enacted staff reductions and cut back on spending plans for exploration and production for 2015. The slump in oil price is a reflection of a market skewed toward the supply side because of production from states rich in shale reserves, like Texas and North Dakota.
Fewer rigs in service could lead to a decline in oil production. State data from the end of January, when oil prices were at a low-water mark, show 156 rigs in service in North Dakota. The slowdown in rig activity, however, has yet to show up in production figures.
State data from November show 1.18 million barrels per day worth of production. For December, data show 1.2 million bpd produced, a new all-time high for North Dakota. More than 90 percent of the production comes from the Bakken and Three Forks shale region of the state.
The NDIC said in its monthly report the low price of oil is "by far the biggest driver behind the slow-down" in rig activity in the state. In the Williston basin, which hosts parts of Bakken and Three Forks, the rig count "has fallen rapidly," the report said.
North Dakota is the No. 2 oil producer in the nation behind Texas.