BakkenMonitor_April-2017

Bakken Monitor – April 2017

  • North Dakota's oil production recovered to 980,294 b/d (+38,000 b/d m-o-m) in January as wells shut-in due to poor weather partially returned, in the upper third of our forecasted range of 0.931 – 1.0 million b/d
  • We see February production of 1.023 million b/d as the remaining shut in production returns
  • Our average US LTO production forecast for 2017 remains unchanged at 4.82 million b/d (flat y-o-y, but +462,000 b/d December 2016 to December 2017)
  • In line with our analysis of a year ago, well costs are rising as activity returns, potentially hampering the production recovery
  • The Dakota Access Pipeline is set to open in April, lowering transport costs longer term, though we expect the immediate effect on production to be muted
  • As bankruptcies tail off, mergers and acquisitions in the Permian continue apace, with land prices nearly doubling in 2016 to average $40,000/acre

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