The state’s Industrial Commission has agreed to re-establish an “inactive well waiver,” in light of very low oil prices.
Under current Commission policy, a well that becomes inactive must be put back into production or capped one year after becoming inactive. It would also affect non-completed wells, which would become abandoned after one year.
The waiver would expire when the West Texas Intermediate oil price reached $50 a barrel. State mineral resources director Lynn Helms told the Commission that’s where the price was just before it collapsed.
"You'd be telling the market that policy-wise, it doesn't make sense to abandon valuable resources," Helms told the Commission. "It doesn't make sense to add oil to an already saturated market. It doesn't make sense to force additinal capital investment, unless the prices are sufficient for our industry to make a profit."
Bakken crude is right now getting between $13 and $18 a barrel.
"The important thing is, you're preventing waste," Helms said. "You're not going to spend North Dakota's valuable resources at $13-$18 a barrel."
The vote was unanimous.