View The Oil Can Extra - North Dakota Petroleum Council

Supplement to The Tioga Tribune ~ July 21, 2010
The Oil Can Extra
See, feel and touch “The Bakken”...................................Page 3
Murex Petroleum, 40 wells and counting..................Page 4
North Dakota oil facts.................................................Page 6
Continental Resources.................................................Page 8
Risk worth worrying about........................................Page 11
Tioga assets key to Hess global strategy...................Page 12
Developers keep Tioga busy.......................................Page 14
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Page 2
See, feel and touch
The Bakken
Tuesday, July 27 will be Oil Day in Tioga,
when the North Dakota Petroleum Council
brings its Bakken Rocks CookFest to the Farm
Festival building.
Tioga oldtimers likely remember the town’s
original Oil Day, barely a year after the discovery of the commodity south of town.
The June 12, 1952 issue of the Tioga Tribune reported:
June 20, Friday is Oil Day and will start with
a grand barbeque sponsored by the Amerada
Petroleum Company at 12:00.
This year’s Oil Day barbecue will be put on
by nearly a dozen different teams of oil operator and service companies.
“All of the oil operators in and around Tioga are participating,” says NDPC President
Ron Ness.
“I think there are around 11 cook teams this
year. They are going to be cooking a variety
of foods, sampler size for people to try them
all.”
“Really, the cookfest is just a community
appreciation day,” continues Ness. “Last year
we had them in Killdeer and Stanley, and we
were completely amazed at the turn out. We
had 1,800 people attend those two locations.
It was a fantastic event, it was something similar to what a state fair was. It was something
for everyone, a great family event.
“We had some entertainment, fabulous food
that some of these cook teams put together,
and lots of stuff for kids. In addition we sprinkle in some educational booths so people can
see and touch and hear and feel the Bakken.”
The cookfest provides a forum for the community to ask questions, to learn about the
industry and to voice complaints, according
to Kathy Neset, of Neset Consulting service.
“The whole thing is goodwill, goodwill within the community,” Neset says.
Says Department of Mineral Resources Director Lynn Helms: “We always get valuable
input at these things and you can’t do enough
public relations, especially in a deal like this
where we are looking at 10 to 15 to 20 years
of high-level activity in communities like Tioga.”
For more on the activities see page 13.
Pumping units like this one located on ND 40
north of Tioga dot the country side in Williams
and Mountrail counties.
Tioga Tribune
Steve Andrist, Publisher
Cecile Wehrman, Editor
Shelly Gleave, Manager
Kyle Ledbetter, Reporter
Stacey Sundhagen, Sales Manager
Stacy Anderson, Office Assistant
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Page 3
Murex Petroleum, 40 Bakken wells and counting
As company solidifies its presence in the basin, they continue
looking for the next Stacey Lynne or Chandler James
By Kyle Ledbetter
Houston based Murex Petroleum Corporation intends to continue operating two rigs in North Dakota with the possiblity of expanding the drilling
progam to four rigs in the foreseeable future, if pricing holds steady and the
opportunity for leasehold acquisitions continues, according to the company’s president, Waldo Ackerman.
“We continue to look for economic drilling opportunities and we’ll develop them as infrastructure and equipment availability allows,” Ackerman
said.
Murex’s pace of growth is more structured than some of the higher profile names in the Bakken play, as it is a privately funded corporation and not
a publicly-traded company working with Wall Street dollars.
“We have a substantial amount of leasehold acreage to drill in North Dakota,” Ackerman said.
“We plan on being around for quite a long time.”
A North Dakota native, Ackerman grew up on a farm near Wishek. As a
kid, Ackerman had family and relatives who worked in the oil industry. He
attended NDSU in Fargo and graduated with a degree in petroleum engineering.
When he graduated, there wasn’t much work in North Dakota’s oil industry, so he ventured down to Texas and Oklahoma to join a small independent oil and gas company. He moved to Denver in 1994 to work for a larger,
public oil company.
Ackerman formed Murex in the late 1990s and began buying
royalty interests and non-operated working interests in oil and
gas wells.
Don Kessel, the company’s vice president and a native of Belfield, joined the company in 1999 and they started purchasing
operated properties.
“Both of us being petroleum engineers, we were familiar with
operating oil and gas wells,” Ackerman said, “so we started picking up some properties and operating them, and we found that
North Dakota was an area with opportunity.
“Properties were available and we saw that we could grow,
and pick up other properties that were for sale, or interests that
were for sale. That’s kind of where we got a start in the operations.
“We did operated properties and acquisitions of operated
properties until about 2004, early 2005.”
By then the price of oil had climbed to the point that it was becoming
more difficult to operate under the business model of acquiring wells already in production.
They realized that they needed to add value and grow the company
“through the drill bit.”
In the fourth quarter of 2004, Murex initiated its drilling program in North
Dakota.
By 2004, a few companies were already using horizontal drilling techniques in the Elm Coulee field in Montana to tap into the Bakken shale.
Sensing that the success in Montana could be replicated on the North
Dakota side of the basin, Murex began acquiring leasehold acreage along
the Nesson Anticline.
“We did some reservoir and geology studies and basically came up with
the Tioga area,” Ackerman said. Because of the large number of vertical
wells drilled around Tioga over the years, there was a good amount of log
and core data to evaluate.
With a limited budget to spend on leasing, Kessel said they approached
the North Dakota play in a selective manner, rather than taking the “shotgun approach” other companies have been known to use.
“We picked what we thought were the absolute best locations to be had
-- until we ran out of leasehold money -- and then we started drilling,” Kessel said.
“The first well we drilled in North Dakota was right on the southwest of
Tioga,” Ackerman said, “a well called the Stacey Lynne.
“It was a horizontal Bakken and the well exists there today.”
Page 4
Above: A Murex pumping unit at the Stacey Lynne site.
Left: Precision 602 rig drilling Murex Petroleum s latest
well, the Brian Webb, about 11 miles north of Tioga.
Murex names their wells after employees, in the order they came
to work for the company.
Since that first successful Bakken well was completed in early
2005, Murex has drilled about 40 more middle Bakken wells in
North Dakota.
While Murex doesn’t publicize initial production figures -- if only
because as a private company they have little reason to -- Kessel
said the wells Murex has been drilling around Tioga recently “look
very good, they are very economical.”
Still, it is unlikely that current wells will compare to the Chandler
James, a Bakken well Murex drilled in Mountrail County in 2008,
which may be the most prolific producer of the entire play.
In addition to the 40 or so Bakken wells, Murex also operates
about another 100 wells in North Dakota.
“We initially started acquiring wells in North Dakota in 1999,”
Ackerman said.
“Our first activity was out in Bottineau and Renville counties.”
The wells in the north are in shallower fields and the company
saw some opportunity to apply secondary methods to enhance
production.
Murex has two water flood projects in the northern fields and
another water flood down by Dickinson.
Ackerman said they haven’t seen a lot of potential in the northern fields to go back and drill unconventional wells. Murex remains
focused on the Mountrail and Williams area of the play.
“When you are looking for apples,
you kind of look under an apple
tree and when you’re working this
Bakken play you kind of stay where
there is success,” Ackerman said.
While there have been some trial
tests in Bottineau and Renville, Ackerman doubts the Bakken there will
ever be as prolific as in the deeper
parts of the basin.
Even though Murex established
a foothold in the play early on and
now possesses a fair amount of
leasehold acreage, the company is
still active in the lease market.
But Murex remains focused as
ever on acquiring quality acreage.
Whether leases are properly
priced these days depends on
where you are, Kessel said. Some
places are only worth $200 an acre,
while others might be worth $2,000,
depending on the location.
But overall, Kessel thinks current
lease prices are fair. Just as not all
farmland is created equal, the quality of the subsurface varies too.
“The Stacey Lynne well, unstimulated, was flowing 65 barrels an
hour and we couldn’t kill it,” Kessel
recalled.
But another well in the area
turned out to be a dog, even though
it had 25,000 feet of lateral. In other
words, “the rock changes.”
“Just because there is acreage to
lease, doesn’t mean we run out and
lease it,” Ackerman said.
“We do some engineering and
some geology looks, and study it as
far as how it fits our current and existing program. Not every acre is a
candidate for leasing, but certainly
we look at any and all acreage and
evaluate it and see if it fits our program and if it works for us on the
Bakken economics.”
Kessel thinks the major risk for
the industry now is the oil price.
“There’s always the price risk.”
A related risk is the ever-present
geopolitical uncertainty, particularly in prolific oil-producing regions
of the world.
If something goes awry in the
Middle East, we could be looking at
$20 a barrel oil tomorrow, or $200,
Kessel said.
“Obviously that is a big risk.”
Just like a farmer is concerned
about wheat or flax prices, oil producers are concerned about the
price of oil.
Murex does some limited price
hedging as a risk management tool,
“to try to take some of the peaks
and valleys out of it,” Ackerman
said.
The economics of the Bakken in
terms of the minimum crude price
necessary for a well to return a
profit depends on location.
“Some areas of the basin are
more productive than others,” Ackerman said.
“Mountrail County has probably
Murex Petroleum s salt water disposal plant near Tioga has a capacity of about 7,000 barrels a day, and has been operating
at maximum capacity nearly every day recently.
been one of the sweet spots, where
prices could move down substantially and it wouldn’t affect drilling.”
Some areas of the basin are profitable at $40 a barrel, others $50,
and some places you’d probably
need to see prices above $100 for
anyone to try drilling there.
“It’s dependent on the quality of
the Bakken reservoir and certain
things like natural porosity and
permeability of the rock,” Ackerman said.
Water saturation and natural fissures also play a role.
In addition to the price risk, Kessel says another major risk is what
he terms “overzealous environmentalists” who might oppose using
fresh water for fracing.
In addition to its oil wells, Murex
also operates a salt-water disposal
facility near Tioga.
Four or five years ago there
weren’t a lot of commercial disposal facilities around, and Murex
was having trouble getting pits reclaimed.
The company re-entered a dry
hole over the hill from where the
disposal is now located and ran
new surface casing and cemented
it up.
They take pit water, produced
water and flowback water from
frac jobs that trucks bring in. After
filtering, the water gets pumped
down the hole and deposited in the
Dakota formation, a saline-water
reservoir about 5,000 feet below
ground level.
“It’s deep enough that it could
never encroach on the fresh water,”
Kessel said.
“We got this well cemented all
the way up to the surface.”
The Murex disposal has a capacity of about 7,000 barrels a day, and
has been operating at maximum
capacity nearly every day recently.
Kessel attributed the high volume
at the disposal this summer to the
large numbers of rigs working in
the area and the backlog on fracing, since many companies don’t
frac in the winter.
In addition to disposing of water
from Murex’s own wells, the facility
also accepts loads from independent trucking companies that don’t
operate their own disposal wells.
Murex also has another disposal
facility near Alexander and is drilling an additional disposal well
there currently.
“With activity moving into McKenzie County now, we see the opportunity to provide the same service down there as we do up here,”
Page 5
Kessel said.
Finding workers in the area has
been a major challenge for the
company. Kessel said he is trying
to fill 10 positions, but it’s hard
to find people locally and out-ofstate people, while interested, get
discouraged due to the lack of adequate housing.
To help with workers’ housing,
Murex has purchased residential
lots in Tioga and is also looking at
other options to accommodate employees.
“We start at $16.45 an hour and
all the overtime you can work,”
Kessel said.
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Kyle Ledbetter
Enbridge is working on plans to further double the company s pipeline export
capacity in North Dakota, according to the company s community relations advisor Kesley Myhre. Obviously there is a definite need for more capacity in North
Dakota with all the production going on in the Bakken and Three Forks formations, said Myhre, so we are kind of working with our shippers to gauge their
interest and planning for a series of projects to meet their needs.
Since the news had not been announced when she spoke to the Tribune, Myhre
Tioga Tribune
couldn t elaborate on the projects, except to say that the projects, once completed, would further double Enbridge s export capacity in North Dakota.
While she couldn t get into specifics, she hinted that expansion activity could
center around the Beaver Lodge Station (pictured above) south of Tioga.
Justin Kringstad, from the North Dakota Pipeline authority, says Enbridge s Bakken
Pipeline Expansion Project should be implemented by late 2012 or early 2013.
North Dakota Oil Facts
• North Dakota is the fourth largest oil producing state. The state's average production in 2009 was more than 218,455 barrels of oil per day,
totaling nearly 80 million barrels for the year, up more than 17 million
from 2008.
• Job Service North Dakota reports that in fiscal year 2008-09 the average yearly wage in the oil and gas extraction industry was $82,803. That
wage is 132.5 percent above the statewide average wage of $35,618.
• All-time production of crude oil in North Dakota amounts to more
than 1.7 billion barrels.
• Production tax revenues for 2009 were more than $392.9 million,
representing a 25 percent decrease from 2008.
• At the end of 2009, there were 5,200 wells capable of producing oil
and gas in North Dakota. The average North Dakota well produced approximately 47 barrels per day.
• Over the past 57 years, the State of North Dakota has received more
than $791 million from oil and gas leases, bonuses, royalties and rentals on state land. During 2009, more than $36.4 million went to the
Lands and Minerals Trust and more than $120 million to the Board of
University and School Lands Trust.
• During 2009, 92.5 billion cubic feet of natural gas were produced and
56.4 billion cubic feet of natural gas were processed in North Dakota.
• Horizontal, or directional, drilling accounted for 95 percent of the
new wells drilled in 2009 and 84.7 percent of the state s total oil production.
• Facts courtesy of North Dakota Petroleum Council. (Thanks Ron!)
Roustabout Service
& Insulating Co.
• Mountrail County was the top-producing county in 2009 accounting
for 37percent of the state s oil production. The other top-producing
counties were Bowman, McKenzie, Dunn and Williams.
• The state averaged more than 5,508 North Dakotans at work in the oil
patch in fiscal year 2008-09. Peak oil field employment occurred in late
1981, when more than 10,000 people were working in the oil patch.
Serving the oil industry since 1963!
• Each drilling rig results in approximately 120 direct and indirect jobs.
• Other sectors of the petroleum industry include refineries, gas plants,
pipelines, retail gasoline stations, wholesalers, and transporters. The
industry altogether employed 12,747 people in North Dakota in fiscal
year 2008-09.
Page 6
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Page 7
20
more years?
Continental Resources expects strong
play to last well into the future
Kyle Ledbetter
Tioga is the “place to be,” says Continental
Resources president and chief operating officer Jeff Hume.
Continental has 21 rigs operating in North
Dakota, 18 of which are pursuing Bakken wells.
Six of the rigs are currently drilling within 25
miles of Tioga and the company is looking to
add at least one more to the Tioga area this
summer.
Hume said Continental began drilling in the
Williston Basin in 1989 in an effort to increase
the company’s exposure to oil. Prior to coming up here, Continental was focused primarily
on the Anadarko Basin in Oklahoma, which is
more of a natural gas play.
The company got involved in the Bakken in
2002 by way of the Elm Coulee field in Montana. In 2003 the company began leasing in
North Dakota with the idea of exploiting the
shale formation here.
Continental’s geological team identified the
Nesson Anticline as a prime spot and drilled
its first well in Divide County in December
of 2003, when it re-entered a dry hole and
established production from a short lateral.
This initial attempt encouraged Continental
to establish the acreage position the company
holds today in the Bakken.
“The backbone of the Bakken being the Nesson Anticline, we began leasing that in 2003,”
Hume said.
Continental’s leasing activity in the area
picked up significantly in 2004, with the company establishing a position of about 350,000
acres. They tried to find a joint venture partner to share the risk, but no other companies
wanted to get involved, so Continental began
drilling the acreage along the anticline on its
own starting in 2005.
“It just slowly ramped up as we’ve learned
how to work it.”
Hume said the play has progressed due to
innovations on the part of many companies,
adding that “everybody shares information -whether they want to or not.”
And the technological advancements are set
to continue, Hume believes.
One avenue for improvement is the process of fracture stimulation. Hume foresees
continued advancements in the way the fracs
are staged, the amount of fluids and the type
of fluids at each stage, the rate the fluids are
pumped, and the amounts of sand and “propant” added to the frac mix.
A propant is a man-made spherical ceramic
grain designed to better hold open the fracture of the rock.
Continental is also working on a technique
to drill multiple wells from the same location,
in order to minimize the use of the surface
land. They call these “eco-pads” because they
are both economical and ecologically friendly.
“One pipeline handles four wells instead
of one, one power line hooks up to four wells
instead of one and it’s also ecologically positive; it
has a smaller ecological footprint,” Hume said.
Continental pioneered the eco-pad concept in
the 1980s while doing some directional drilling
projects within the city limits of Enid, Okla., where
Continental is based.
“We currently have three rigs drilling the ecopads today, up and down the anticline, one of them
near Tioga.”
Hume anticipates the company will have six rigs
drilling on eco-pads by the fourth quarter of this
year, with two or three of them in the Tioga area.
Continental has recently announced a major
increase in its capital expenditure budget for 2010. The
company now intends to invest
$1.3 billion this year to accelerate its drilling program and to
increase its leasehold acreage.
In conjunction with the
capex expansion, Continental expanded its bank credit
facility to a maximum of $2.5
billion. However, the increased
bank financing might be seen
as a temporary measure.
“We are exploring options to
continue funding acceleration,”
said Hume.
“There’s quite a few different
things we can do. Of course,
we’re a public company, so
there’s always the opportunity
to do equity. Bond yields are
fairly low now, so we may go to
the bond market to get some
money.”
Asset sales of non-strategic
acreage have also been announced by the company,
Hume noted. Some acreage
spreads that never reached
critical mass in areas outside
the Bakken are being sold
to offset some of the budget
increase.
With over 800,000 net acres
in the Bakken, Continental is a
major player in the leasehold
market.
Hume said lease prices are
all relative to how close you
are to a proven, producing
well.
He equated development of
the Bakken to going fishing in a
new lake.
“A brand-new lake’s been built, fish have been growing
in it for 15 years and they finally opened it up for fishing.
“So we go out there in three boats, the first one of us
catches a fish and the other two of us drive over next to
him and fish. So we’ll fish that until we don’t catch any
more fish or until we run out of opportunity there. Then
we spread out again and the next guy will start catching
fish and we all move there. That’s kind of how this play’s
gone, wherever people have started drilling is where the
play has go to.”
With a large lease position and one-third of the company’s drilling fleet working in the area, Tioga is the
“place to be,” Hume said.
Tioga is going to have a very good economy for the
next 15 or 20 years because of the developing oil industry, according to Hume.
“If we could get the national economy to come around
to be just half of what North Dakota has, we’ll have it
made.”
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Page 8
701-664-1492 office
Kyle Ledbetter
Tioga Tribune
Hess Corporation plans to double the capacity of the Tioga Gas Plant in the near future.
Tioga assets key to Hess global strategy
Hess Corporation CEO John Hess
identifies the Tioga Gas Plant (above)
as a key asset for the company.
During a presentation to Wall Street
analysts last month, Hess explained
how the Bakken shale play is a key
piece of the company’s global strategy
to grow production while at the same
time, maintaining reserve growth. And
in turn he identified the gas plant,
which is about to undergo a major
expansion, as the centerpiece of
Hess’s presence in the Bakken, saying
it is a key piece of infrastructure other
companies don’t have.
Explaining the company’s Bakken
strategy Hess told the analysts: “Over
the last several years we have refined
our strategy to have a more balanced
approach to growth, and the other
part of our strategy, if you will, is to
build a world class position in unconventional resources. That’s led by the
Bakken shale in North Dakota, where
we have over 500,000 acres.
“Hess was one of the first companies to find oil in North Dakota in
1951, so we have had a legacy HBP
(held by production) position there,
but we’ve built upon that position and
along with EOG Resources have the
largest holding of acreage for Bakken
shale.”
“The company is growing its footprint in unconventional to balance the
risk of some of the high-impact exploration we’re doing,” Hess added.
Hess is currently producing about
14,000 barrels of oil per day in the
Bakken. The company intends to
boost that number to 80,000 in the
next five years.
Hess is investing about one-quarter
of its $4 billion yearly exploration and
production budget on Bakken produc-
Enbridge:
tion and related infrastructure.
Hess said its current Bakken production generates a profit margin of
10 percent with a West Texas Intermediate crude price at $40.
“This is a pretty competitive use of
our money and that’s the reason it’s
about a quarter of our budget,” Hess
said.
Hess intends to use the experience
it has gained in the Bakken play to
pursue other shale oil plays, such as
the Paris Basin play in France.
Enbridge is committed to
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Page 9
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Page 10
Stanley
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Federal government top risk for oil field
Cap and trade, frac regulations are major concerns in oil industry
By Kyle Ledbetter
The oil industry and its top
regulator see commodity pricing and the federal government
as the top risks for a flourishing
oil field in North Dakota.
Ron Ness, president of the
North Dakota Petroleum Council, notes that the oil industry
is still a commodity-based business.
While operators are trying to
improve efficiency and lower
costs, “the bottom line starts
and stops with the price of oil,
so we need a reasonably high oil
price in order to make the Bakken continue to be economic
until costs are decreased to the
point that it is economic at fairly
low prices,” Ness said.
The industry in North Dakota
needs to attract $800 million a
month in order to keep activity at its current level. For that
amount of investment capital to
continue flowing into the state,
Ness estimates that the price of
crude needs to be in the range
of $55 to $70 a barrel.
While there is the promise
of reduced costs because drilling times have been reduced,
Ness said fracturing time has
increased substantially with the
advent of the multi-stage fracs.
Additionally, operational costs
have increased due to the high
level of activity. Overall, he is
not sure that well costs have
been reduced much.
Aside from lower oil prices, the
biggest risks to the oil industry
in the state come from potential
developments in Washington
D.C., according to Lynn Helms,
director the North Dakota Department of Mineral Resources.
Helms identified possible regulation of fracing, regulation of
blowout preventers, cap-and-
trade legislation and tax provisions in the president’s budget
as major risk factors for the industry.
“Any one of those could reduce activity 20 to 50 percent,”
he said.
Helms doubts any legislation
to regulate fracing will pass before this year’s congressional
election, but he is concerned
that a bill could get pushed
through after the election in a
lame-duck session.
State Sen. John Andrist is also
concerned about an anti-fracing
law coming out of D.C.
“One of the issues that we are
deeply concerned about is that
congress is examining hydraulic
fracturing,” Andrist said. “The
Bakken is dead if they stop fracing.”
Andrist said they may need
to control fracing in the natural
gas industry where it is done at
shallower levels, but he hopes
they will have enough sense not
to lump all fracing together.
Ness says we are seeing kneejerk reaction and opposition
to hydraulic fracturing, a technique which he notes has been
around since the 1940s.
“We’re seeing congressional
hearings, we’re seeing EPA hearings and there’s the concern
they are going to regulate hydraulic fracturing on the federal
level and that is something that
is not good for North Dakota. We
have a wonderful regulatory entity in North Dakota that is fully
capable of doing this.”
On the tax front, Helms says
the proposed cap-and-trade
bill would increase the cost of
gasoline and diesel fuel by 75 to
80 cents a gallon, which would
amount to a huge tax increase
on domestic oil production.
He also says the president’s
budget would eliminate longstanding depreciation and deduction allowances for energy
producers.
The road to tax simplification
Even while the oil industry is
in the federal cross-hairs, at the
state level it is pushing for a favorable change in the tax structure.
Ness says more money needs
to be put back into the counties
where activity is. He also wants
to see a “more predictable, stable oil tax structure in the state,”
so as to “provide certainty as
we move from the exploration
phase into the development
phase of the Bakken.”
“Right now we have a tax
structure that potentially has
a 130 percent swing in it from
the high point to the low point,”
Ness said.
“At the high point it is very
high, at the low point it is very
low, so what we are looking for
is a more predictable flatter rate
in the middle.”
Tax rates in North Dakota
vary from 5 percent of the value
of the oil at the wellhead to 11.5
percent.
Fluctuations in the tax rate
make it hard for the state to
project revenues and hard for
operators to project costs, according to Ness.
“We are seeking a proposal to
flatten that tax rate and to provide more certainty and stability.”
Ness said we can expect to see
a tax-simplification bill ready by
the 2011 legislative session.
State Rep. Bob Skarphol says
that if Ness just wants to simplify the tax structure, then
that is fine, but if the proposal
involves lowering taxes then it
will be necessary to negotiate
“who’s going to be responsible
for what.”
“It kind of comes down to
‘what do you want -- lower taxes,
or roads fixed’?” Skarphol said.
“If we lower the tax, should
we be responsible for fixing the
infrastructure? I guess I’m not
convinced of that.”
As for the issue of road work,
Skarphol thinks he may have
just the fix.
Skarphol is writing a bill that
calls for the state to set up a
reimbursement program to get
money to political subdivisions,
primarily counties and townships, “as quickly and as easily and as neatly as possible to
compensate for development”
needed during drilling.
Once a month, the Department
of Mineral Resources would notify the state treasurer as to how
many wells have been spudded
in a given county in the previous month. The treasurer’s office would then cut a check to
each county for $20,000 per well
as a one-time payment.
Of the money dispersed to the
county, 20 percent would go to
the township in which the well
is drilled.
Skarphol says the appropriations for the program would be
funded from the oil trust fund
and the money dispersed would
be in addition to whatever other
oil impact monies are currently
being allocated to the counties
or townships.
He also says the program is
structured so that when the
drilling stops the program
stops, since the money is only
sent to the counties when a well
is drilled.
Tioga Machine
Shop, INC.
• Complete Oil Field Service Station
• Heavy Oil Field & Industrial Construction
• Farm and Auto Work
Phil Gustafson
701-629-0090
Nick Gustafson
701-629-1621
6551 Hwy 40 8 Tioga, ND
664-3337
Page 11
Kyle Ledbetter
Tigoa Tribune
The Oil Can! program is designed to open the
lines of communication and improve understanding between the petroleum industry of North Dakota and key stakeholder groups such as property
owners, policy makers, community leaders, media
reporters and the general public.
The Helmerich & Payne 293 FlexRig drills a Bakken well for Hess east of Tioga, near White
Earth in Mountrail County. Hess currently has eight rigs operating in North Dakota. Six of these
are located within 20 miles of Tioga.
! "#$ % &'
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Tioga, ND Office: 701-226-6226 ~ Killdeer, ND Office: 701-764-6430 or 701-483-7868
New Town, ND: 701-260-8201 ~ Williston, ND - Ajax Division: 701-774-2529
email: knrroustabout@ndsupernet.com
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Cell:
701-260-8201
Killdeer
Greg Krueger
Cell:
701-226-6226
Page 12
2nd Annual Bakken Rocks Cookfest Teams
Tioga July 27
New Town July 29
Oil Can! information
Booths
Murex Petroleum & Wyoming Casing/
Missouri Basin Well Service
Marathon Oil Corporation & Bear Paw
Hess Corp & Nabors Well Service
Slawson Exploration & Key Energy
Bakken geology ‒ Kathy Neset
Continental Resources & Hamm & Phillips
Whiting Petroleum Corp. & Halliburton
ND Association of Oil & Gas Producing Counties
‒ Vicky Steiner
Petro-Hunt & Nabors Well Service
Petro-Hunt & Nabors Well Service
Pipelines
XTO & Penkota Wireline
Kodial Oil and Gas & Wyoming Casing/
Missouri Basin Well Service
Energy careers ‒ Kent Ellis
ND Petroleum Council
Department of Mineral Resources
Oil & Gas Research Council ‒ Brent Brannan
Brigham Exporation & S&S Sales/EnerMAX
Questar & Balon Valves
Whiting Petroleum Corp. & Halliburton
EOG Resources & S&S Sales/EnerMAX
Oasis Petroleum & Ward Williston
Peak North Dakota
How to drill a Bakken well
SM Entergy Co. & Bayou Well Service
Enerplus & Red Rock Transportation
Safety
Enbridge Pipeline (ND)
Spotted Hawk & Power Fuels
American Oil & Gas & Power Fuels
XTO & Penkota Wireline
**People will have an opportunity to learn more about
drilling and production operations directly from the operators.
Denbury Resources & Wilson Supply
**Great food and local entertainment
Bakken Basics Education Session topics:
(2:30 - 4:30 p.m.)
Bakken geology
Regulatory processes
2nd Annual Bakken Rocks
&22.)(67
Empire Oil Company is an oil and gas
lease acquisition company.
Empire Oil Company began in
business in May 1983.
Empire Oil Company is located at
510 West Second Street,
P.O. Box 1835,Williston, ND.
Email: bill@empireoil.net
Phone (701) 774-2845
Fax (701) 774-3537
Bill LaCrosse
-XO\ Tioga, ND
5:00 - 8:00 p.m. CDT
-XO\
5:00 - 8:00 p.m. CDT
Farm Festival Building
New Town, ND
4 Bears Casino
Little Shell Amphitheater
Bakken Basics Education Sessions will be held at both locations
from 2:30 - 4:30 p.m. CDT. More info is available at WWW.NDOIL.ORG.
Tioga - Farm Festival Building
New Town - Four Bears Casino: Mandan, Hidatsa & Arikara Banquet Rooms
Good food - Good fun Lots to learn for everyone!
No alcohol permitted
Please RSVP by visiting
WWW.NDOIL.ORG
1 2 5 7 + ' $ . 2 7$
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8
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Buying & Leasing of Minerals
Page 13
Developers keep Tioga busy
The old saying in real estate is “location,
location, location.”
Tioga City Hall has a similar saying these
days: “developers, developers, developers.”
Tioga’s economic growth from the exploration of the Bakken has spurred a variety of
developers to this area.
Now, I am not saying this is a bad thing.
Tioga is in great need of housing to keep in
pace with workers coming to town. The developers come, see and decide whether they want
to stay, invest or find opportunity elsewhere.
It reminds me of my grandfather, who homesteaded in northwestern North Dakota. He
came to the United States from Norway, homesteaded his 160 acres of fertile prairie, returned
to Norway, got married, had two children and
returned two years later.
I hope that it doesn’t take as long for Tioga’s
housing needs to be fully developed as it did
for my grandfather to return to northwestern
North Dakota from Norway. But the reality is
that it does take time -- time to find available
lots and land, time to draw up contracts, attend meetings and fill out needed paperwork.
A developer’s first stop in town is generally
city hall. We work with them, finding out what
they are hoping to accomplish. This is when it
gets busy. I can have a developer call me back
Viewpoint
By Kathy Jorgenson
several times a day and many times during the
week. Most are from out of state or elsewhere
in the state, so we need to explain the process
the city of Tioga has for bidding on city owned
lots or requesting zone changes.
That does not mean every developer will
stay. One workforce housing project received
local opposition and the developer retracted
its application. That is why there is a process
in city government that ensures the public’s
needs are always considered first and foremost.
That maybe is why my grandfather came to
the United States. Citizen rights were better
obtained in this country than in Norway at that
time.
For whatever reason, the exploration of the
Bakken has given northwestern North Dakota
great opportunities, which I hope we can all
embrace for the City of Tioga, as well as any
developers that come our way.
(Jorgenson is Community Development Director for the City of Tioga.)
On The Cover.......
Precision 602 rig drilling Murex Petroleum s latest well, the Brian Webb, about 11
miles north of Tioga in Williams County.
Phot by Kyle Ledbetter
Tioga Tribune
SHELDON WELDING &
STEEL, INC.
Northwest North Dakota’s only
complete Steel service center!!
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Page 14
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When Experience Counts!
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301 E 26th St
Williston, ND 58801
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701.752.4083 Office
701.572.4085 Fax
701.572.3427 Office
701.572.3428 Fax
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701.774.5002 Fax
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Page 15
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Page 16