North Dakota Doubles Unconventional Oil Production since 2008

How about some good energy news for a change you can really believe in?  North Dakota Department of Mineral Resources (DMR) released its latest report of monthly oil production announcing that April production set a new high of 284,348 barrels per day.[1]

“We’re on a mission to find a place where we can mine sand in North Dakota. It’s all imported now from Ontario, Michigan and some from Texas. But there’s a $2 1/2 trillion potential industry. We need to have North Dakotans taking advantage of that.”

That was the message delivered to a Minot, North Dakota audience by Lynn Helms, Director of DMR—and he got their attention.

What does sand have to do with oil?

Helms told the audience that E&P activity in the Bakken play was so strong that the oil industry today needs about 5 million tons of sand per year for its hydraulic fracturing drilling technique to keep up. The value of the oil and gas produced from North Dakota production is potentially about $2.5 trillion per year at the mine mouth Helms said.

With natural gas prices low and oil prices rising, unconventional producers are shifting their attention to oil production capacity expansion across the unconventional plays.  The results in North Dakota have not disappointed.  While all eyes are on the Gulf of Mexico oil spill, North Dakota is quietly producing more oil per day than the estimated spill.

Water Contamination Risks

There are issues including concerns about groundwater contamination and new EPA studies about the need for additional regulations.[2] For the most part such efforts are good if they result in best practices turned into good rules to reduce or minimize environmental threats and force all the oil rush E&P players to abide by safe, environmentally responsible practices.  If the US EPA or environmental advocates opposed to more domestic production use the proceedings to diminish the market potential for unconventional oil and gas that would be a tragedy.

Recently, Oil Drum, among others, reported on controversy in New York over unconventional gas drilling in the Marcellus Shale because of groundwater contamination from fracking chemicals used.[3]

While we figure out how to plug the leak and clean up the mess in the Gulf of Mexico America’s unconventional domestic energy boom continues in places like North Dakota.


[1] https://www.dmr.nd.gov/oilgas/stats/historicaloilprodstats.pdf

[2] http://www.epa.gov/ogwdw000/uic/wells_hydrofrac.html, and http://www.epa.gov/OGWDW/uic/wells_coalbedmethanestudy.html

[3] http://local.theoildrum.com/node/4338