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Oil drilling rig count at 58 and still falling

WILLISTON, N.D. - North Dakota has fewer than 60 drilling rigs operating in the state for the first time since 2009, about a third of what were operating a year ago.

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Stacked rigs are seen along with other idled oil drilling equipment at a depot in Dickinson, North Dakota June 26, 2015. (REUTERS/Andrew Cullen)

WILLISTON, N.D. – North Dakota has fewer than 60 drilling rigs operating in the state for the first time since 2009, about a third of what were operating a year ago.

The state’s rig count fell to 58 on Monday, with three more rigs scheduled to become idle after crews complete drilling the current well.

The last time North Dakota’s rig count was below 60 was in October 2009 when the state had 55 rigs, said Alison Ritter, spokeswoman for the Department of Mineral Resources.

A year ago, North Dakota had 171 active drilling rigs, but that figure has steadily fallen as oil prices dropped to the lowest rate since 2008.

“From a year ago, it’s quite shocking,” said Ron Ness, president of the North Dakota Petroleum Council.

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Lynn Helms, director of the Department of Mineral Resources, said in December, when the rig count was 65, that he expected it to fall by another 10 as companies continue to cut back on costs. Ritter said Monday that projection still holds true.

Although the rig count is one indicator of how busy oil activity is, Ness said the big thing to watch in 2016 is how many wells companies complete.

At the end of October, the state had 975 wells that were drilled but waiting on hydraulic fracturing crews as companies prefer to keep the oil in the ground until prices recover.

Ness said companies don’t have much optimism for the first part of 2016 and he expects more well completions to be delayed

“They are likely to sit as tight as they possibly can,” Ness said.

Drilling is concentrated in the core area of the Bakken, where companies can get the highest returns on investment.

McKenzie County continues to have the most drilling with 25 rigs active on Monday. Dunn County had 13, Mountrail County had eight and Williams County had five active rigs on Monday.

Divide and Burke counties each had two active rigs and Stark, Bowman and Renville counties each had one.

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The Department of Mineral Resources estimates that every rig supports about 120 jobs.

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