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Trivia Time
Six Facts About ND Oil
1. Oil production in North Dakota has
increased more than 600 percent in the
past several years, from 35.7 million barrels
of oil in 2005 to 237 million barrels
in 2012. In 2005, North Dakota was
the No. 8 oil-producing state in the nation,
and in just seven years has moved
up to become the No. 2 state for oil output
in 2012, behind Texas.
2. North Dakota provides about 11 percent
of United States oil production,
and the Bakken accounts for 40 percent
of the nation’s increase in domestic
oil production in recent years.
3. North Dakota has been an oil-producing
state for about 60 years, and there
have been some past boom cycles but
the present one is entirely different from
the previous ones. In past years, the success
rate was around 30 percent; with
horizontal drilling and hydraulic fracturing,
there is a 99 percent success rate.
4. As of last February, the state had
8,500 wells and was producing about
779,000 barrels of oil per day. With the
current technology, each well is expected
to produce for about 30 years, and
each one will produce about 550,000
barrels of oil.
5. To drill a new oil well in the Bakken, it
costs about $10 million, and each well
will generate about $20 million in net
profit. Each well pays about $4.4 million
in taxes, $7.6 million in royalties,
$1.6 million in salaries and wages.
6. An economic impact study in 2005
estimated that the oil boom had a
$4.4 billion impact on North Dakota’s
economy, but that has increased now
by almost 600 percent to $34.4 billion.
There are about 40,856 petroleum
industry jobs in North Dakota; along
with the roughnecks, truckers and other
employees working directly with the
drilling operations in the oil patch, there
are an estimated 18,000 indirect jobs
supporting the petroleum industry that
include workers in legal services, administrative,
communication professionals and
human resources.
To put the economic impact of oil on the
North Dakota (and United States) economy
into perspective, it’s as if there are now 8,500
“small businesses” (wells) operating in the
western part of the state, and each of those
“small businesses” are paying millions of dollars
in royalty payments to local landowners
and farmers, they are employing hundreds of
workers and paying good salaries and benefits,
they are generating millions of dollars
of profits for the owners of the oil companies,
and they are paying millions of dollars in taxes
to local and state governments. With 8,500
profitable “small businesses” (wells) operating
in the state, double the number three years
ago, and increasing at the rate of about five
new “small businesses” every day over the last
year, it should be pretty easy to understand
why North Dakota is frequently referred to as
“America’s economic miracle state.”
Source: www.aei-ideas.org/2013/04/north-dakota-oil-facts
BASIN BITS | Spring 2014 103