By Rep. Paul Anderson
America’s energy future is bright, mainly because of new drilling technology that allows crude oil and natural gas to be located underground and brought to the surface. Because of fracking in shale deposits in North Dakota and elsewhere around the country, we have become the largest producer of oil in the world. It is rapidly allowing the United States to become energy independent, but it is also changing the landscape in other ways, as well. Because natural gas has become so abundant and relatively cheap, it is quickly replacing coal as the main energy source of our nation’s baseload electric generation.
I had the opportunity last week to tour the North Dakota Bakken oil field, as part of an energy conference hosted by the Council of State Governments. Along with two days of listening to speakers in Bismarck, we spent one day on the road to the north and west of the capital city. We traveled to Tioga, N.D., which is where the first well in the Bakken area was drilled over 60 years ago.
Wells began dotting the landscape about half ways between Minot and Tioga. We also passed a vacant group housing camp along the road, a sign that activity in the Bakken has slowed as the price of oil dropped from over $100 a barrel to its current price around $40. Even still, more than a million barrels a day are being produced, although that figure is dropping and may fall below one million before it’s expected to increase once again when oil prices recover. There are currently 34 active drilling rigs operating in the state. A lot of the work being done today involves laying pipelines to take natural gas away from the drilling rigs. In the past two years, over 4,000 miles of pipe has been laid throughout the Bakken that collect natural gas in the field and transport it to central locations for cleaning and shipment out of the area.
At one time, up to 36 percent of the natural gas produced at the wellhead was flared off. The good news is that today, the amount of flaring has been reduced to 11 percent. The natural gas produced during the drilling process along with crude oil contains other liquids that must be separated before they can be shipped. Those other components are methane, ethane, propane, butane, and liquid natural gas. Each has value, and the network of pipelines being built captures this gas and transports it to facilities that separate the various components and market them. We toured one such plant on the edge of Tioga that has unit train and pipeline capabilities to ship product out.
The sheer size of the Bakken Formation, some 15,000 square miles, is the main reason so much gas was flared off in the early years. It takes time to build out the system of collection pipes to capture the gas. The state of North Dakota set goals for the reduction of flaring, and right now the drilling companies are ahead of those targets. Eventually, they will get down to around 5 percent flaring.
Drilling costs are being reduced as the price of oil has dropped. Where only one well may have been built on a pad years ago, now multiple wells are being drilled on a site. That saves the cost of tearing down and reassembling the drilling rig for each well, which is about a 4-day process. The huge rigs, weighing well over one million pounds, can be moved to another site on the pad by way of four huge hydraulic “legs.” The drilling site we toured had three pumping wells, and crews were in the process of drilling 6 additional wells on the pad, which is roughly the size of two or three football fields. The work is hard, and it was hot. (I can’t imagine what it must be like when it’s 20 below and the North Dakota wind is blowing). Crews at the location we visited work 12-hour shifts, 14 days on and then 14 days off. They were putting the finishing touches on a well that was two miles deep and ran for over 10,000 feet horizontally. Workers told us that at the end of the horizontal run, they can hit a target the size of a 5-gallon pail!
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