Letter: Bakken – The best is yet to come

Letter: Bakken – The best is yet to come

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The Bakken oil boom is an amazing story on its own, but when you consider the resulting economic growth across North Dakota as well as the Bakken’s contribution to the U.S. becoming the world’s top oil producer, it becomes the story of the decade. As we embark on 2020, we look forward to building on our success and making the next 10 years the best decade yet.

Oil production in North Dakota grew 553% over the last decade due to the development and deployment of horizontal drilling and hydraulic fracturing across the Bakken oil fields. We ended 2019 with average oil production of 1.4 million barrels per day. Compare this to average production of only 218,456 barrels per day in 2009.

The shale revolution allowed for rapid exploration and growth, which brought jobs and prosperity but also infrastructure challenges for our western communities over the last decade. When prices dropped and things slowed down, our operators developed better technology and practices to do more with less, production continued to increase, and our communities have had time to build up infrastructure to support the maturing industry.

The gift of this natural resource in our state has not only stimulated population growth, job creation and economic development in the oil patch, it has also brought financial prosperity to the entire state. Since 2010, the state population has grown more than 13%. As we once struggled with the mass exodus of our youth, younger generations now have assurances of jobs and economic security. What a difference an oil boom makes.

In 2009, the total economic impact of the oil industry in North Dakota was $12.7 billion, and total direct and indirect employment was 36,057. By 2017, those numbers had risen to $32.6 billion economic impact, with total employment of 51,428. When you look at oil tax revenues alone, the numbers are staggering. During the 2009-2011 biennium, oil and gas production and extraction taxes totaled $1.56 billion. In 2019 alone, collections exceeded $2.5 billion. Over the last ten years, oil production tax collections account for half of all state taxes collected.

The last decade has thrust our once little-known flyover state onto the world stage. From oil boom to downturn to steady growth, we stared OPEC in the eye and upended the traditional order of the global oil market. As a result, the United States is now the top oil producing country in the world, and North Dakota is the second highest oil producing state.

We will continue to address challenges through research, innovation, hard work and common-sense regulation, including the need for improved gas capture. It takes time to plan and construct the necessary infrastructure to keep up with our growing production and we are up to the task and excited about the potential growth opportunities. With our proven formula for success, the sky is the limit and we look forward to the prosperity that the next 10 years will bring.

Ron Ness is president of the North Dakota Petroleum Council.

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