A new black gold rush is under way, this time in North Dakota. The potential payoff is huge — up to 100 billion barrels of oil. That’s twice the size of Alaska’s reserves and potentially enough to meet all U.S. oil needs for two decades.
Until now, the obstacles to production seemed overwhelming. The crude oil is locked away in rocks that are buried miles underground in the Bakken Play, a field that stretches into Montana and Saskatchewan, Canada.
But times have changed. High oil prices and new technology make it worth the effort. Computer analysis and remote sensing systems, plus smart drills that can probe horizontally or snake left and right, vastly improve the odds of locating new pools and putting them into production.
Using the horizontal drilling technology, some companies have recently begun drilling under Lake Sakakawea, the vast Missouri River reservoir behind Garrison Dam. A real estate manager with the Corps of Engineers reports nearly half his time is spent taking inquiries from oil companies.
Prices cycles have caused economic disruption in the state in the past. North Dakota lost 50,000 people after the last oil boom went bust in the ’80s (coinciding with the drought and farm crisis), but as Kiplinger’s suggests, it’s hard to see oil dropping back to the $10 a barrel level.
Environmental opposition to the oil industry is relatively muted in North Dakota, with the most vocal outfit being the Dakota Resource Council. But with 56 rigs drilling in the state, you can bet there will be more criticism, if only as a red flag for fundraising.
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