The Dakota Access Pipeline Is Reaping Benefits for Manufacturers After Just Six Months of Operations

By January 3, 2018General

Last year, the Trump administration approved final construction of the long-paused Dakota Access Pipeline (DAPL) in North Dakota. Six months later, the pipeline is fully operational, and it is already delivering economic benefits for thousands of manufacturing workers.

A new editorial from The Wall Street Journal takes a look at the pipeline’s performance and runs through the numbers. Not only is the pipeline creating more jobs, but it is generating additional revenue for the state:

Between September and October alone, oil production grew by 78,000 barrels a day, the biggest month-over-month increase North Dakota has ever seen. The state peaked at around 1.185 million barrels a day that month—135,000 barrels more than it produced daily before the pipeline was operational. Compared with January 2017, North Dakota has an additional 15 drilling rigs currently in operation…

Increased oil production has resulted in job growth. North Dakota’s unemployment rate was 2.3% in November, and more than 850 existing wells need fracking crews. State revenue rose by about $43.5 million in the first five months the pipeline was operational. And solely because of the Dakota Access Pipeline, the state is on track for $210 million to $250 million in additional tax revenue by the end of this biennial budget period.

The editorial also points out that the pipeline has drastically reduced oil train traffic in the state, which is a win for the environment considering that oil spills occur much more frequently on trains than in pipelines.

In 2015, a study on the economic effects of pipeline construction commissioned by the National Association of Manufacturers found the following:

  • From both construction and maintenance in 2016, crude oil pipelines supported 243,167 jobs, including 28,438 manufacturing jobs.
  • Crude oil pipelines contributed $46.9 billion to GDP, including $7.6 billion from manufacturing.
  • At least 66 different manufacturing subsectors, out of 86 total, benefited from the construction of crude oil pipelines by $10 million or more in 2015 alone. These include iron and steel, fabricated metals, cement, machinery and paints and coatings.

So far, the benefits of the Dakota Access Pipeline are already materializing for thousands of manufacturing workers in North Dakota. It is yet another reason why the administration, Congress and our local and state leaders should be encouraging crude oil pipeline investment.

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