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Getty Images via NewsCred

North Dakota rig count at lowest level since 2010

The number of drilling rigs operating in North Dakota’s Bakken formation dropped to 158 this week, the lowest level since November 2010, according to a report by Reuters.

The drop in the rig count is the latest reaction to declining oil prices. In one day, the state lost eight rigs, a dramatic decline that hasn’t been seen in years. In the nation’s second largest oil producing state, rigs are contracted by oil producers to drill vertically and horizontally into the earth. The rigs then pack up and travel to another site, allowing the well to be hydraulically fractured.

Rig counts in North Dakota are closely watched and the decline comes as no surprise. Recently, companies such as Continental Resources, Oasis Petroleum, Halliburton and others announced drastic reductions in spending for the coming year. Companies have also announced plans to cut the number of rigs in operation.

Although technological advances and increased drilling efficiency has led to the use of fewer rigs, many analysts are pointing to low oil prices as the reason for the decrease. Rig counts are widely used as an indicator of an oil field’s viability and health. More rigs means more wells are being drilled and increased production. As of December 2014, North Dakota had 183 rigs in operation. North Dakota’s rig count is updated daily and can be viewed here.

To read the original article by Reuters, click hereIn related news, Rig count trends among major U.S. shale plays.