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North Dakota’s Shale Explosion: Because Keystone is only a Frack-tion of our Problems

North Dakota’s Shale Explosion: Because Keystone is only a Frack-tion of our Problems
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By Matthew Brian Smith
Art by Blake Jones

 

The new Texas is North Dakota. The frenzy took a noticeable statistical turn in around 2006, when fracking of the Bakken Shale increased 150-fold. The state is now the second leading domestic supplier of oil and natural gas behind Texas. There are approximately 8,000 wells in production today, which produce an approximate 900,000 barrels of high-quality crude oil per day, as of October 2013. Texas is closer to two million and is also going through a boom, so maybe North Dakota will not catch up, but it is expected to become more and more prominent. These statistics do not include natural gas production, by the way.

Ultimately history tells us that the bigger the money the bigger the problems. The technology in North Dakota fracking hasn’t caught up to oil industry standards? Yes it’s true. The leaks from improper procedure have the potential to pollute fresh water supplies? It’s most likely. The oil companies in North Dakota were aware of these problems after seeing the writing on the wall? It would not be surprising. But still, there is so much money so all that can be ignored for a paragraph.

The state with the fastest growing economy according to Forbes indicators is North Dakota. There are likely at least 17 billions barrels of quality crude oil and approximately 244 millions barrels have been recovered. There could also be 6.7 trillion cubic feet of natural gas. Each well costs approximately 10 millions dollars and can generate: $20 million in profits, $4.4 million in taxes and $1.6 million in labor wages. There are approximately 8,000 wells in North Dakota and 8,000 times each of those numbers is way-higher numbers. $100,000-a-year jobs are now being created in relative abundance in a state that previously had no need for such jobs. Most impressively perhaps is the state’s unemployment rate hovering at less than 3%, when the national average has cooled down to a usual 7.6%.

Maybe you have seen news reports about gas wells that have contaminated fresh water supplies so severely that entire communities can light their water on fire, and people have claimed that this happens in North Dakota. These problems occur in situations where the technology is up to date. It is possible that North Dakota’s fracking isn’t actually up to standard. The state had sparse infrastructure prior to 2006 and the oil infrastructure was akin to that. The state is going through an oil boom, and now the companies involved are trying to catch up. This is not to say that they don’t get the oil, because they definitely get the oil, but Texas and Oklahoma (and many other states) have a complex system of pipelines that are as sophisticated as any oil-producing and distributing region on the planet, and North Dakota simply doesn’t have this yet. According to National Geographic’s polling, most of the oil and natural gas is transported via truck. In order to get North Dakota up to Texas levels, the Grand Prairie must be industrialized.

There is, I assure you, an Enron/Erin Brockovich angle to these developments that can back up the claim that many Matt Smiths have made about the state of North Dakota’s technological problems. Many of the companies who frack in the region have names closer to Tesoro Logistics than Exxon, which is of course not to say that Exxon and BP don’t have oil spills, because they certainly do. Exxon and BP create massive oil spills with irreversible (for now) environmental effects and they are always using the top of the line technology and the highest paid engineers. Tesoro Logistics may not have access to these resources, so when Tesoro’s 20-year-old pipeline leaked 20,000 barrels of oil out of a ¼ inch hole in the pipeline onto wheat fields in the prairie maybe no one should be surprised. And of course there is evidence of an attempt at a coverup and other things that would make for a good book, but the main point is that this will probably happen again if you truly observe Murphy’s Law.

The town of Willinton, North Dakota has gotten the most coverage of the North Dakota oil phenomenon due to being at the heart of the Bakken Shale oil patch. The city’s population was approximately 18,000 people as of the 2012 census, and 14,000 as of the 2010 census, and its unemployment rate is almost zero, which is impressive considering how many people have moved there with the hopes of getting an oil industry job. Before his death last year, the father of fracking, George P. Mitchell of Woodlands-fame, called for much tighter regulations on fracking, due to the rapid onset of environmental problems. Yet, when the whole country is slowing down due to recession, it is hard not to get involved in an oil rush.

 

Statistics provided by: National Geographic, Al Jazeera America, Forbes, MSN Money

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