Federal guidelines, workforce shortages hindering North Dakota’s oil production amid high prices

BISMARCK, N.D. (KFYR) – Sanctions on Russian oil have left officials in the United States divided on who should fill the gap in production. Some are looking towards other foreign markets while others are pushing for ramping up oil production domestically. Unfortunately, officials say either option won’t bring an immediate increase in Bakken oil production.

While high oil prices may lead some to believe another oil boom could be coming to North Dakota, the mature branding by top operators and investors are leading them towards other plays like the Permian. Workforce issues and federal guidelines are also keeping companies here hesitant about expansion.

Despite oil prices ranging from $90 to $120, officials say it remains difficult for operators to improve their production numbers.

“Regulations and the policies of the federal administration are completely countercurrent to ramping up US production,” said Lynn Helms, North Dakota Department of Mineral Resources director.

Helms said there are at least 13 policies negatively impacting production with no sign of reversal despite issues overseas. Right now, he said operators and investors are looking at the long term, over any short-term results.

“They are not interested in seeing the profits from this higher oil price be plowed into new wells and new infrastructure in the face of an administration that long-term, wants less oil and gas production,” said Helms.

It’s not just policies impacting development. Helms added that finding people to work those rigs remains the toughest challenge operators are facing to add more rigs.

North Dakota currently has 33 rigs drilling. In February, Helms was expecting to see a dozen more added this year, but employment issues have led him to temper expectations to only half of that.

Copyright 2022 KFYR. All rights reserved.