North Dakota gas flaring drops: EIA data

Natural gas flaring has dropped significantly in North Dakota despite rising output as new processing plants and tougher state mandates take effect.

North Dakota's flared natural gas production in the Bakken formation has been on a decline since 2014 and most recently reached record lows. Flared natural gas rates in this region dropped to a low of 10pc, less than one-third of the 2014 rate of 36pc.

The rising amounts of captured gas have contributed to North Dakota's natural gas production hitting a record high in March of 1.71 Bcf/d (48mn m³), according to the US Energy Information Administration (EIA).

US gas market participants are watching production data closely this spring for signs that a sharp downturn in drilling is beginning to curb US output. Efforts to improve operational efficiency could buoy production, increasing supplies into an already crowded market.

June prices at Emerson, Manitoba, a bellwether for North Dakota production, were at a 23¢/mmBtu discount to the Henry Hub, expanding from a 12¢/mmBtu discount a year earlier.

The recent decline in natural gas flaring is a result of targets established by the North Dakota Industrial Commission which requires natural gas flaring to be reduced to a rate of 9pc by November 2020.

In addition, new infrastructure throughout the Bakken region has cut flaring. With the construction of these new pipelines, larger volumes of natural gas are reaching market, the EIA said.

New wells account for the majority of natural gas flaring that still occurs in North Dakota. North Dakota oil and gas regulations tax wells where flaring has occurred for more than a year. Those wells are increasingly being capped and connected to pipelines to move gas to market.