(Photo by James Ulvog, showing flaring of natural gas that can’t be tied into a pipeline.)
Here’s a few long notes on interesting news that I won’t cover in a separate post:
Production may drop for a while
10/2 – Million Dollar Way – North Dakota Oil Production Likely To Start Falling – Rigzone, Reuters – The MDW article quotes Rigzone explain why production will be likely be falling at times over the next year.
There are severe penalties kicking in starting yesterday (10/1/14) for any well that does not capture 74% of the natural gas. Since there is not enough pipeline capacity to carry away the natural gas there’s a good chance that many wells will have to be closed in until pipeline capacity catches up.
Three factors combine to create this issue.
- First, natural gas cannot be transferred by truck until it has been processed. I don’t have a clue about the chemistry involved, but have read repeatedly that is the case. There isn’t enough pipeline capacity in the state because of the rapid growth of production.
- Second, the extensive maze of byzantine red tape from multiple state and federal agencies means that it takes a painfully long time to build new pipelines. Thus, there is a lot of flaring.
- Third factor is that the state aggressively wants to reduce flaring, therefore the harsh new rules.
The result is that until pipelines catch up a few, some, or many wells will have to be closed in. May take until 2015 to get enough pipeline capacity on line, according to the article.
Toiga leak followup
9/23 – Tioga Tribune – One year after the Tesoro spill – The cleanup is continuing on the 20,600 barrel oil spill from October 2013. Remediation will take another 12 or 18 months. The concept, in just a few words, is to scrape up the dirt in a 30 acre area down to a depth of 20 or 30 feet, run the dirt through an incinerator-like device to burn off the oil, rehydrate the dirt, put it back, and then replace the topsoil. Still no conclusion as to what ruptured the pipeline.
10/4 – Bismarck Tribune – Unusual alliance on oil spill cleanup near Tioga – Good update on cleanup, including interview with the farm family whose land suffered the spill. Estimated cost of cleanup is $20.6 million.
9/8 – Chick Oil – Want to Work in the BAKKEN? Here’s what to expect. – Great advice if you are thinking of heading to North Dakota to seek your riches in the oil boom. With unemployment below 2%, essentially anyone who actually wants to work can get a job. I read a comment somewhere (Million Dollar Way?) that the only people not working in western North Dakota are those who aren’t physically able to and those who don’t want to.
That is in sharp contrast to California, where few graduating high school and college students can find jobs.
Here’s the article’s advice, with a few comments from me.
1 Don’t come alone.
Cool idea: Show up with your buddy or spouse. One can go to work in retail and get paychecks flowing quickly. My impression is that retail work is available when you walk in the door. The other person can take the time to get a far higher paying oil job. When that cash starts flowing, the first person looks for higher pay.
2 Leave your drugs at home
Two words for oil companies: Zero. Tolerance.
3 Rental management companies
Get preapproved by several property managers. Makes it far easier to get a place when you arrive.
Interesting concept behind the comment is that the housing stock is starting to catch up with the influx. Housing is still tight apparently, but not as outlandish as in early 2012.
4 Have a vehicle and AAA
It’s a loooong way between towns. There’s not a gas station every quarter of a mile and repair shop every other mile, like in southern California. You need a vehicle. And a membership card with AAA.
5 Have a hobby.
Have something to entertain yourself or starting taking online classes. Set yourself up for a focused reading program. Article points out it is healthier, cheaper, and less frustrating than hanging out at the bars. Also less dangerous.
9/18 – Dickinson Press – Sun sets on Bonanza: Citing lack of workforce, restaurant shuts doors after 35 years – A buffet and steakhouse restaurant in Dickinson is closing. The eatery is down to 11 staff from 32 needed to run full-time. Reason? It cannot compete with wages offered by the oil industry. People can earn around twice as much in energy compared to retail or food service. Other restaurants have trimmed their hours as one way to cope with lack of staff.
My guess is that’s a problem across all of western North Dakota.
Oh, the county unemployment rate is officially listed at 1.4%.