North Dakota Petroleum Council Chairman Rick Ross provided the following comments on behalf of the association at the EPA July 13 hearing in Denver, which discussed the practice of hydraulicc fracturing as used by oil companies in North Dakota's Bakken formation to increase well production rates.
The North Dakota Petroleum Council represents more than 200 companies in the oil and gas industry in North Dakota and South Dakota including oil and gas production, refining, gas processing, pipeline, and oilfield service activities. Our members produced 98% of North Dakota’s 80 million barrels of oil in 2009.
In 2008, the United States Geologic Survey (USGS) announced what oil and gas operators already knew, their study indicated that up to 4.3 billion barrels of technically recoverable oil reserves were available from the Bakken formation in North Dakota and Montana. Development of oil reserves from the Bakken formation is possible due to development of sophisticated new technology utilizing multiple stage hydraulic fracturing technology in extended reach horizontally drilled wells. This tremendous oil resource for our country is exclusively recoverable through the use of hydraulic fracturing technology.
Development of this strategic national resource in North Dakota has provided great economic benefit to the State as evidenced by the following:
•North Dakota has moved from the 9th to the 4th largest oil producing state, currently producing nearly 300,000 BOPD.
•As one of only two states with a budget surplus last year, North Dakota had a $1 billion budget surplus in 2008 and is projecting similar surplus this year.
•The state’s unemployment rate is 3.6%, compared to the nation’s average unemployment rate of more than 9%. Job Service North Dakota currently has more than 200 employers with more than 400 oil-related employment opportunities.
•The U.S. Energy Information Administration reported that oil production increased 7.4% in 2009 over 2008, mostly due to increased oil production in North Dakota. Oil production in 2009 was the highest level of domestic oil production since 2004, and the first annual increase in oil production since 1991.
We ask you to keep the focus of the study to the topics identified by Congress in the study authorization, to answer technical questions about hydraulic fracturing. We also ask that the study be transparent, scientifically credible, and that you seek public comment on your methodology and process.
We support North Dakota Governor John Hoeven and other governors who are adamant that states currently do an excellent job of regulating the industry and should continue to be the primary regulatory body for hydraulic fracturing. In fact, we ask that state regulatory agencies be included as participants in the study.
Our nation’s groundwater is arguably our most precious resource. We must be diligent in protecting it now and for future generations of Americans. All we ask is a focused and scientifically-based assessment of hydraulic fracturing. We stand ready to assist with your study and open to doing our work better and in providing solutions in the best interest of all of us.
The North Dakota Congressional delegation and Governor have publicly stated their support for continued state jurisdiction and regulation of this process. Continued capital investment and development of this critical Bakken resource requires predictable, responsible and appropriate oversight of this process.
Once again, many of the great things happening in North Dakota are a result of the Bakken. This issue has tremendous ramifications for our state, our citizens, and the nation, and we urge you to complete your study as authorized and leave the regulatory responsibilities under state jurisdiction.
Thank you for the opportunity to provide comments.
Source: North Dakota Petroleum Council
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