Bakken Drilling Economics Strengthen as WTI Holds Above $94

The economics of drilling new wells in North Dakota's Bakken formation remain favorable with West Texas Intermediate (WTI) crude oil holding above $94 per barrel, according to live market data. As of midday Sunday, WTI was trading at $94.40, while the global benchmark Brent crude stood at $99.13.

A typical new Bakken well costs between $7 million and $8 million to drill and complete. At current price levels, these costs can support strong internal rates of return for operators. The break-even price for a new Bakken well is generally estimated in the mid-$40 to low-$50 per barrel range, making the current price environment highly profitable for new drilling.

The number of active drilling rigs in the state, however, remains historically low at 23. This suggests that despite robust commodity prices, public operators continue to prioritize shareholder returns and debt reduction over aggressive production growth. Capital discipline has been a hallmark of the post-pandemic shale industry.

Estimated Ultimate Recovery (EUR) for modern Bakken wells typically ranges from 500,000 to over 1 million barrels of oil equivalent over the life of the well. With WTI near $94, the gross revenue potential from a 750,000-barrel well exceeds $70 million, far outstripping the upfront capital outlay.

The current WTI price of $94.40 represents a decline of $1.45 from the previous settlement. Despite this daily dip, prices are supportive for continued development drilling by operators with prime acreage in the core of the Williston Basin. For mineral rights owners, sustained high prices translate to stronger royalty checks from both new and existing production.

The focus for many Bakken producers has shifted to optimizing production from existing wells and drilling only the highest-return locations. The subdued rig count indicates that the high well costs, while manageable at these prices, are being weighed against other uses of capital, including dividends and share buybacks.