New flaring rules in North Dakota

North Dakota is taking the next step in its efforts to reduce flaring in the state, imposing restrictions on oil producers who cannot meet strict targets for curbing the burning off of gas.

Operators who fail to capture enough gas at specific well sites could be limited to oil production of as little as 100 barrels per day, depending on how much gas is flared from the well.

If at least 60% of the gas is captured, the well or wells will be restricted to 200 bpd.

The new policy, which takes effect on 1 October this year, "is a dynamic shift in the way regulators approach reducing natural gas flaring", Governor Jack Dalrymple said in a statement.

Since 1 June, North Dakota has required operators to submit a plan for capturing gas at the same time they apply for drilling permits, including a signed affidavit to show that gas-gathering companies have been consulted.

It is all part of a six-step policy unveiled by the state in March aimed at reducing flaring.

The latest order "provides regulatory teeth to the requirement to have a gas capture plan", the regulatory North Dakota Industrial Commission said.

Companies can also face production restrictions if they do not adhere to their gas-capture plans.

North Dakota is booming in oil production with more the 1 million barrels flowing per day. But producers in the Bakken and Three Forks formations flare off some 30% of the associated gas produced.

The most recent official figures from the North Dakota Industrial Commission's department of mineral resources show that around 34 billion cubic feet of gas was produced in the state in April, but only around 22 billion cubic feet was sold.

Nationwide, less than 1% of gas it typically flared from oilfields. That figure climbs to just 3% for oilfields worldwide.

North Dakota regulators hope to reduce flaring to 26% by the fourth quarter of this year, 23% by the beginning of 2015, 15% by 2016 and 5%-10% by the end of 2020.

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