Sunday, April 26, 2015
North Dakota had just begun to emerge as a veritable Saudi Arabia of the Great Plains. Hydraulic-fracturing technology — better known as "fracking" — had opened up exploitation of the vast Bakken (rhymes with "talkin' ") Shale formation, a 200,000-square-mile rock formation, filled with oil, that spans parts of Montana, Saskatchewan, Manitoba, and western North Dakota. Soon the state would surpass Alaska to become the nation's number-two oil producer, trailing only Texas. (If it were a country, North Dakota would now be 19th worldwide in oil production, tied with Colombia.)
By this spring, the cost of a barrel of oil had plummeted by 60 percent. Production in North Dakota had fallen apace, leaving both longtime residents and the newcomers who moved here to make a quick buck in a kind of limbo — waiting to see whether, and when, prices will rise again. It's been a hard lesson in the economic realities of a natural-resource economy, showing just how beholden North Dakota — like other regions of the country that have embraced fracking, such as western Pennsylvania and Texas — has become to global geopolitical currents that it can't control.
Last June, the price of a barrel of crude stood at around $115; since this winter, it's been hovering at about $50. North Dakota oil goes for even less than that — about $38 a barrel — because of the high costs associated with moving the stuff out of a geographically remote locale. The plunging price of crude has sent shudders through the Bakken and Watford City. The future now seems even more uncertain than it did during the heady days of the initial boom, and ominous signs are everywhere. In the past year, the number of active drilling rigs in North Dakota — the ones that drill new wells — has fallen by more than half, from a peak of 218 to fewer than 100.
The above are excerpts. Read Ethan Epstein's entire article here: Fracking Town USA.
We do not need to suffer these economic booms and busts caused by oil's strategic status if we had true fuel competition in America. Please write to your Members of Congress and urge them to co-sponsor the Fuel Choice and Deregulation Act.