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Bottleneck blues: Full pipelines hinder flaring progress; State sets record for oil production

Press Photo by April Baumgarten A jack pumps oil on July 30 approximately five miles south of Belfield.

BISMARCK — North Dakota set another record for oil production in June, but reducing the amount of natural gas flared continues to be a struggle.

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Preliminary oil production estimates for June were 1,092,617 barrels per day as good summer weather has been a boon to operators, the state Department of Mineral Resources said Friday.

North Dakota also produced an all-time high of 1.25 billion cubic feet per day of natural gas in June, based on preliminary figures.

But the percentage of gas flared remained at 28 percent, the same as in May, “a slice of bad news this month,” said Lynn Helms, director of the Mineral Resources Department.

North Dakota has been trying to reduce the amount of natural gas that goes to waste by being burned away at wells. The gas is a byproduct of oil production, but the industry lacks sufficient infrastructure to make use of all of it.

It had been hoped that the expansion of the Hess natural gas processing plant at Tioga would make a bigger dent in the percentage of gas flared, but Helms said the plant is operating at only 59 percent of capacity.

Helms said there is a bottleneck as Hess works at upgrading a supply line near Keene that would bring a significant amount of natural gas from south of Lake Sakakawea to the plant, which is north of the lake.

“If we get that plant up to full capacity over the summer, we will see some significant changes,” Helms said.

North Dakota has a goal of capturing 74 percent of the natural gas produced by Oct. 1.

Helms said regulators also are seeing that there is less gas being captured on the Fort Berthold Indian Reservation (67 percent) than off the reservation (72 percent).

He said there may be some jurisdictional issues on tribal lands that could hinder the state’s ability to meet the gas-capturing goals as tribal officials are developing their own rules to address flaring.

Other highlights from Friday’s update include:

-- An announcement may come Monday or Tuesday on an Industrial Commission hearing on the treatment of crude oil to remove volatile gasses before it is shipped.

-- North Dakota added 2,578 miles of new pipeline in 2013, bringing the total miles of pipeline up to 19,934, said Justin Kringstad of the North Dakota Pipeline Authority.

-- Good weather helped reduce the number of wells waiting to be completed by 25 wells, down to 585.