When oil production was on a steep curve upward over the past five years, North Dakota oil/natural gas officials, like the industry they oversee, were working hard to keep up with the unparalleled growth. Today, they are working just as hard to figure out what the current pullback in that growth means longer term.

Most of the industry and state officials have the same long-term vision of operations returning to a normal growth pattern, but figuring out when that is going to happen and what is going on in the mid-term is plagued by uncertainty, said Justin Kringstad, head of the North Dakota Pipeline Authority.

"Right now it is a work in progress readjusting the timelines and expectations," Kringstad told NGI's Shale Daily.

Another side of the slowdown is the time it has provided to operators and midstream companies to "catch their breath" and get infrastructure work done at a reasonable pace, according to one recently retired senior executive in the industry who has worked in the Bakken. "The state was having a hard time catching up, they didn't have enough inspectors, and I was really worried there was going to be a catastrophe," he told Shale Daily. "Thank God, we haven't had what happened on the rail side [see Shale DailySept. 26, 2014].

"The retiming now is really good; it is sort of like halftime, now you adjust your game plan a little bit and get ready to go at it again."

Lynn Helms, director of the state’s Department of Mineral Resources (DMR), said infrastructure investments continue at the same pace. "Everything from housing to highway to midstream, it all continues," he said. Reduced drilling and completion delays have all helped in the gas capture arena, according to Helms.

"We have seen increased investment in compression in order to boost and debottleneck the system. The best example would be one company that operates in northeast McKenzie county. They have added seven new compressor stations and doubled their plant capacity to now operate at 40% surplus capacity. They are now going back and concentrating on line-looping to gather more gas.

"In the long run this kind of slowdown is healthy as it does give time for all kinds of infrastructure to catch-up."

Kringstad pointed out that the statewide slowdown has not applied to the four-county core area for Bakken production (Dunn, McKenzie, Mountrail and Williams counties) where there is an even greater level of concentrated activity now than during the high growth period.

"Now we are just drilling in some of the prime acreage of the region, so we have the challenge in that area of understanding how that rig concentration impacts infrastructure needs," Kringstad said. "There is sufficient infrastructure in parts, but there are some areas that are still underdeveloped."

He said that all the timelines from last fall on how fast production would increase in the concentrated area are changing again. "We have the dynamic that as more rigs move into the core area the production techniques and recoveries have increased, so it definitely makes life interesting."

The gaps between the concentrated, high-activity areas and the slower fringe areas in the overall Bakken play are much wider now, Kringstad said.

New infrastructure projects for crude oil are "still working through the regulatory processes," Kringstad said. "On the natural gas side, the [200 MMcf/d] Oneok Demicks Lake gas processing project has not been taken off the table; it is just trying to understand what the revised timeline should be."

In some areas, project timetables have been sped up because of the higher concentration in the core area, and in other areas gas gathering systems have been delayed, he said.

In terms of concentration within the four-county core area, "if you had to point to one area as the most extreme concentration, it would be northeast McKenzie County," said Kringstad, who noted that the latest continued decrease in the percentage of wellhead gas being flared is an indication that "infrastructure is still getting built" within the so-called overall slowdown.

Another indication that the infrastructure is being built, he said, is the fact that the percentage of Bakken crude being shipped by rail in April was the lowest it has been in three years, hitting 54%, after being around 70% at times last year.

A knowledgeable source in nearby Minnesota noted one of the major pipeline contractors in the Bakken went into this year fully expecting 2015 to have increased work because there would be continued emphasis on infrastructure even with overall production slowing. "It's an inexact science when you are repiping the industry," the source said.

Helms cited some major pipeline incidents in the last year, and the fact that they led state lawmakers to pass legislation this year (HB 1358). "This bill expands the state Industrial Commission's jurisdiction over gathering pipelines and is funding a study to look at the root causes of pipeline incidents and the best technology to install on these pipelines moving forward," he said. "Come December, we will begin writing rules as a result of the study."