Martens PLLC, Attorney at Law
Trusted Law Firm Serving All Of North Dakota
Local 701-223-2000 Toll Free 888-307-1302

Start Today With Your Initial Consultation

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

NEW FLARING REGULATIONS TO SLOW PRODUCTION

7111272.jpg

The North Dakota Industrial Commission is considering a proposal that would cut back on the state's booming oil production as a means of controlling the amount of natural gas that's being burned off at well sites and wasted as a byproduct of the more valuable substance, oil. But oil companies are fighting the idea of slowing production, and want regulators to consider self-imposed steps to curb natural gas flaring, such as submitting plans for natural gas gathering before applying for a drilling permit. (Rigzone via The Associated Press). While regulations that slow down or stop production until gas capturing infrastructure is in place certainly would benefit royalty owners and the state's coffers, it would have a negative effect on the industry, and in turn the state and royalty owners, as major alterations to drilling programs could jeopardize the financing producers rely on to participate in the Bakken play. As mentioned in a prior post, the majority of producers in shale plays such as the Bakken are independent companies, rather than the majors or "seven sisters" (not to say the majors do not have a presence). These smaller companies often rely on financing rather than investor-based capital to finance their drilling programs. With their financing at risk, they're more likely to focus their efforts in other areas where costs are not as high, such as the Eagle Ford and Permian Basin in Texas, which has the potential to reduce the overall income the state sees from oil production. 

No Comments

Leave a comment
Comment Information

Martens400.jpg

1045171_0.png

iStock-157375323.jpg