By Liz Hampton
(Reuters) – North Dakota’s oil regulator on Tuesday agreed to evaluate providing aid to state oil producers that would allow them to restart shut-in wells in the future, the head of the North Dakota Petroleum Council trade group said.
U.S. oil prices settled at $10 a barrel on Tuesday after falling into negative territory a day ago. The prices, below many producers’ cost of output, reflect a collapse in demand from coronavirus-related business restrictions and surplus of supply.
President Donald Trump on Tuesday called on his administration to make funds available to the U.S. oil and gas industry. North Dakota is the second-largest U.S. oil-producing state after Texas.
North Dakota’s Industrial Commission requested that Lynn Helms, the head of its mineral resources department, evaluate proposals in other oil states and return with options, said Ron Ness, president of the North Dakota Petroleum Council.
Helms was unavailable for immediate comment and a spokeswoman for the department did not reply to requests for comment.
Among the commission’s requests were to consider whether excess production could be considered economic waste, and to weigh whether the state-owned Bank of North Dakota and state Commerce Department could help finance the restart of shut wells in the future, Ness said.
North Dakota has shut in about 300,000 barrels per day of oil production, or more than 20% of the last year’s daily total, Ness added.
“Restarting these wells can come at great expense,” Ness said.
On Tuesday, Texas energy regulators took no action on a proposal by two large shale producers calling for a 20% production cut by larger producers under a policy that allows state cuts when the oil could be considered economic waste.
(Reporting by Liz Hampton and Gary McWilliams; Editing by Will Dunham)
