More good stuff on the Bakken – 5/4
Here’s some fun notes on interesting news around the Bakken. Big change on the oil tax. Slowdown is drilling is having some interesting impacts on the housing market. Also, tracking the rig count.
5/1 – Dickinson Press – North Dakota still on track for oil tax break – Oil prices in April were below the level which will trigger the “big trigger” tax reduction on oil. If West Texas Intermediate is below a threshold, currently $52.29, for five consecutive months the 6.5% oil extraction tax is waived for two years on wells started after the trigger is pulled. One more month below the cut off will trigger the drop.
Except the legislature decided to change the law since it looks like the trigger had a good possibility of getting pulled.
4/29 – Reuters at Dickinson Press – Dalrymple signed sweeping oil tax changes into law – The new law reduces the total tax on crude oil production by 1.5%. The offset is that the “large trigger” is revoked starting with December 2015.
The trade-off is that instead of a 6.5% drop for two years when oil is below a certain threshold for five months the tax will be dropped by 1.5% permanently.
It is sort of funny. There’s nothing like changing the rules once it looks likely that something favorable to producers or creators or productive people is going to kick in.
4/16 – Dickinson Press – Uniform trafficking law heads to governor’s desk – The legislature passed a bill which the governor is expected to sign which increases focus to helping trafficking victims instead of prosecuting them. Minors entangled in prostitution are granted Safe Harbor, which provides immunity from prosecution. Adults can get their arrests and convictions for minor crimes expunged. Avoiding a criminal record makes it easier to escape what is called “the life.”
Previously discussed a superb seven-part series by Forum News Service: Human trafficking – the dark side of life
4/25 – Dickinson Press – Following the work: RV lots experience effects of oil slowdown – The slowdown in drilling is starting to affect occupancy rates in RV lots. Before crude oil prices dropped by half, one option for long-term housing was to winterize an RV and rent a space in an RV lot. Every lot was always full with long waiting lists. Several owners of lots report they are now actually seeing a few vacancies. The number of telephone inquiries is dropping as well.
4/29 – Million Dollar Way – The Bakken Bust – Mr. Oksol is visiting Williston for a few days. Observations on vehicle traffic is there are no water trucks. Fracking is on hold at the moment and more water is getting to sites by temporary pipes. Also, he spoke with someone whose apartment rent is going up. My inference from his speculation is that lots of mancamps are closing which is moving people into apartments, thus driving up demand for apartments.
5/1 – Million Dollar Way – Construction In The Bakken – Mr. Oksol describes the huge amount of construction underway in Bakken cities. Much of it he saw on his recent trip and much is planned in near future. Interesting giveaway – all the construction crews he saw were working on weekends and into the evening. Looks like there is still a major push to get work done.
Tracking the rig count
4/17 – Million Dollar Way – Seven (7) New Permits – Active rig count 93.
4/21 – Million Dollar Way – Active Rigs Hit the ‘90’ Mark – April 22, 2015
4/25 – Million Dollar Way – Friday’s Daily Activity Report – April 25, 2015; Active Rigs Down to 84
4/29 – Million Dollar Way – Rig count is up to 87.
5/1 – Million Dollar Way – Rig count essentially flat at 86.