Bakken faces flaring issues from gas production increase

By Patrick C. Miller | May 17, 2018

North Dakota saw a slight decline in oil production in March as gas production reached an all-time high, a trend that could result in flaring issues for the Bakken later this year.

Currently, the North Dakota Industrial Commission (NDIC) requires producers to capture 85 percent of their gas. On Nov. 1 this year, state regulations require the percentage to increase to 88 percent.

Lynn Helms, director of North Dakota’s Department of Mineral Resources, said that during March, the gas capture rate statewide was 88 percent. “That tells us with summer coming and increased activity, 88 percent capture on Nov. 1 is not going to be easy,” he said. “It is going to be a real challenge.”

North Dakota crude production during March fell by 1 percent to 1.162 million barrels per day from 1.175 million the previous month. Gas production for March increased to 2.116 million cubic feet per day, up from 2.106 mcf per day in February.

Combined with lower oil prices, snow and windy weather hurt North Dakota’s production in March. However, Helms said he anticipates potential major production increases during the summer months.

“We continue to see natural gas production outpacing oil production,” he said. “It’s one of those months when gas is up even when oil is down. That informs and presses the challenge for gas capture. It keeps the pressure on in terms of gas capture.”

Helms noted that help is on the way with an estimated $3 billion in new gas gathering and gas processing infrastructure scheduled to come online in North Dakota later this year and into 2019. “We’re going to see another surge of workers from out of state—laying pipelines, building compressor facilities and building gas plants,” he said.

However, until that happens, meeting gas-capture quotas for the second and third quarters of 2018 could be problematic because the first of five new gas processing plants won’t be operational until later in the year.

“The timing is just not going to work out,” Helms explained. “If we see people really go after these 900 noncompleted wells in June and July like we anticipate, folks are going to be very challenged to capture that gas. That tells us that the second and third quarters of this year are going to be an extreme challenge.”

With Whiting Petroleum’s Robinson Lake gas plant down for maintenance and repair, Helms said flaring could become an issue as soon as this month.