This page contains a Flash digital edition of a book.
Page 4


Spring 2011 • BAKKEN BREAKOUT


By Brian Kroshus, BismarckTribune Publisher


This December winter scene taken east of Mandaree depicts a project of Kodiak Oil and Gas, with the drilling done by Unit Drilling. Photo: Vern Whitten Photography


The positive economic impact North Dakota is experiencing from oil activity in the western part of the state is staggering. Based on some estimates, the extraction of sweet crude from the Williston basin might only be in its infancy as industry experts attempt to get their arms around exactly how much recoverable crude exists some two miles below the surface of the rugged Badlands.


Estimates of recoverable oil in the Bakken play varies considerably, but one figure that is getting attention these days is 20 billion barrels. That’s the number being used by oilman Harold Hamm, Chairman and CEO of Continental Resources who believes the number of wells in the state could


eventually climb to as high as 48,000 in the years ahead.


Simply put, those figures from any perspective are astonishing. While it certainly bodes well for tax revenue generation it also means state officials will be challenged to monitor drilling activity and increase appropriate resources in tandem with climbing production levels.


Still, in an environment where the majority of the other states continue to experience high unemployment and budget deficits, North Dakota is extremely fortunate. Making national headlines for entirely different reasons are states like Wisconsin and California. Balancing their respective


budgets will involve making difficult decisions and significant tax increases in order to get back on track.


Many other states in the union are also struggling mightily under the weight of the recession with limited relief in sight. While national and global economic conditions are slowly improving, the sluggish pace of the recovery offers little consolation to a private citizen underwater with mortgage or collecting unemployment.


In stark contrast is the Roughrider State. A responsible culture of conservative spending combined with record oil production has meant windfalls for many segments of our economy. Government too has


benefitted significantly from tax revenue windfalls related to oil production creating a budget surplus for the state.


The intensity of the boom moving forward will undoubtedly depend largely on the future price of crude. Forecasting price is never easy with so many variables factoring into the equation, it’s far from an exact science. The one known constant is that we live in an oil hungry world, and it appears that demand will only grow in the years ahead.


Growing pains It’s not surprising that dramatic increases in production have left both state government and local entities


Page 1  |  Page 2  |  Page 3  |  Page 4  |  Page 5  |  Page 6  |  Page 7  |  Page 8  |  Page 9  |  Page 10  |  Page 11  |  Page 12  |  Page 13  |  Page 14  |  Page 15  |  Page 16  |  Page 17  |  Page 18  |  Page 19  |  Page 20  |  Page 21  |  Page 22  |  Page 23  |  Page 24  |  Page 25  |  Page 26  |  Page 27  |  Page 28  |  Page 29  |  Page 30  |  Page 31  |  Page 32  |  Page 33  |  Page 34  |  Page 35  |  Page 36  |  Page 37  |  Page 38  |  Page 39  |  Page 40  |  Page 41  |  Page 42  |  Page 43  |  Page 44  |  Page 45  |  Page 46  |  Page 47  |  Page 48