Download now: Cannabis Cash

Move Over Alaska, Here Comes the Bakken

North Dakota Oil Production Up Again in April

Written by Brianna Panzica
Posted June 14, 2012 at 6:45PM

The Bakken shale formation in North Dakota continues to be a bountiful source of domestic oil, and production rates have only increased as drilling forges on.

On Tuesday, the North Dakota Department of Mineral Resources released figures that showed an increase in wells and in oil production for the month of April.

7,025 wells were producing 18.2 million barrels of crude oil that month, up from 6,932 wells producing 17.9 million barrels in March.

North Dakota still ranks number two in oil-producing states, falling only behind Texas after surpassing Alaska's production in March.

In April, Alaska's oil production was down significantly from the month before, dropping to about 16.5 million barrels from a previous 17.5 million.

And some Alaskans are afraid North Dakota will push their state aside even more with this continuous oil supply.

Alaska's Tesoro will begin refining Bakken light, sweet crude oil in September.

Until now, Tesoro Alaska, regional branch of the Tesoro Corporation (NYSE: TSO), was mainly responsible for refining Alaska's own North Slope crude and Cook Inlet oil. But these kinds cost more and take more effort to clean than Bakken oil.

30,000 barrels per day of Bakken oil will be shipped by train to the refinery in Nikiski, Alaska, which has the capacity to refine 120,000 barrels per day.

It is rumored that the oil may replace the North Slope oil, which has locals concerned about the economic impact of replacing state-produced oil with out-of-state oil.

Meanwhile, North Dakota is weighing its own local risks and benefits that come with the oil boom. Though the unemployment rate, especially in Bakken counties, has significantly lowered, newly employed oil workers are often homeless, living anywhere they can from man camps to trailer parks.

On Tuesday, the state put to a vote whether to abolish property taxes. The influx of state revenue from the Bakken allowed the option of tax abolition to become a possibility, though voters decided to keep it in place.

From Reuters:

Supporters of getting rid of the property tax system argued that the state's oil surplus funds should be directed to local costs in lieu of property taxes. The problem is that North Dakota's oil income is already promised to fund other budget items in the state.

State revenue in North Dakota from property taxes currently totals roughly $812 million. Should the income from the Bakken ever waver, even if the funds could be redirected, the state could get itself into trouble.

But though this wavering in price is certainly possible, right now the North Dakota Bakken is looking pretty successful. It's still behind Texas' March production rate of 1.75 million bpd, but officials expect that gap to shrink.

Just look at this chart of North Dakota oil production over 12 years, courtesy of Mark Perry.

North Dakota Oil

The shale oil boom is providing the United States with more domestic energy than ever. And North Dakota is one of the main hubs of productivity.

Related Articles

Is British Columbia the New Bakken?
In the northeast corner of British Columbia, near the border with Alberta, another North American energy story is taking shape. And just as with the others, the first in stand to make the most.
Emerging Oil Investments
Energy and Capital Editor Keith Kohl reveals two emerging oil plays that are still flying under Wall Street's radar.
Bakken Infrastructure Investing
Energy and Capital editor Keith Kohl explains a win-win scenario developing in bringing Bakken oil to market.
You Should Be Bullish in the Bakken
Two Reasons to Remain Bullish. As well as things are going for my buddy up in the Bakken, things are about to get even bigger there.


Is it Safe for You to Buy Coal Stocks Yet?
Shedding Light on the Death of the Coal Industry
Investing in the Future of Solar
How to Profit Like an Investment Banker
Without the ITC, is Solar Still a Good Investment?
Will THIS Kill the Solar Industry?
The Secret Behind the Gatwick Gusher
Is the UK Running Out of Options?
Buffett Has a $4.5 Billion Stake in This Refiner
Refiners Are Safe Havens During the Low-Price Period
An OPEC Civil War Erupts
Strange Things Afoot in the House of Saud
Energy Utilities NEED the Internet of Things
Stay connected to stay on target!
The Lithium Revolution Just Got Hotter
Utility-Scale Lithium Batteries Taking Off
Metal Oil Investing 101
Meet the Oil of the 21st Century
Tesla's (NASDAQ: TSLA) Final Deathblow
The Ultimate Tesla Play