This remote corner of North Dakota is the site of the biggest U.S. oil rush in decades. It is pumping new supplies into oil markets and swelling state coffers; advocates say it could help reduce U.S. dependence on foreign oil. But the boom is also spreading a degree of chaos across the rural towns and gently undulating pasturelands here.
Two towering oil rigs are drilling holes on Nelson’s property. One of the rigs, alongside two rows of 25-foot storage tanks, is planted on a red dirt pad, or clearing, right below a majestic butte that Native Americans over the ages have visited for ceremonial fasts. When they were kids, Donny and his brother climbed up and carved their names on the flat-topped butte next to others going back to 1880.
This is Nelson’s land, but he won’t see any money from those wells, or nearly a dozen others that firms are planning to drill. The mineral rights were sold years ago, starting in the 1950s, when oil was discovered in North Dakota. Nelson and his family have leased out rights they do own, and his share of the royalties from four wells comes to about $8,000 a month.
It’s a modest sum, he said, for the headaches that come with it. He’s squabbled with oil companies over drilling waste, a saltwater spill and decades-old storage tanks eaten away by chemicals.
“I’d give it all back if I could for all the trouble it’s been,” said Nelson, 48.
Above all, he misses a time when people didn’t lock their doors and knew all their neighbors.
“I don’t like what it’s done to our communities and lifestyle,” he said. “We had a good life, and now it’s gone forever, or at least for my lifetime.”
Across this stretch of western North Dakota, an oil boom is in full swing, kicking up dust and controversy among longtime residents.
About seven years ago, oil companies figured out how to use horizontal drilling and hydraulic fracturing to extract unconventional oil resources trapped in a geological formation called the Bakken, which was previously too difficult and expensive to tap. This is not a conventional reservoir, but the source rock for oil up to 15,000 feet deep, spanning parts of Montana, North Dakota and Saskatchewan. Technological advances have enabled companies to unlock that oil. With petroleum fetching record prices over the past year and a half, North Dakota is the scene of an old-fashioned oil rush.
This isn’t entirely new. North Dakotans experienced drilling booms in the 1950s, when oil was found, and in the early 1980s, when prices soared. But this boom is the biggest yet and may be the longest-lasting.
More than 200 rigs are at work in North Dakota, and because the entire geological formation holds oil, the rigs hardly ever hit a dry hole. Oil output has more than doubled in two years and jumped fivefold since 2006, to 609,503 barrels a day in April, providing about 3 percent of U.S. oil consumption and accounting for about 10 percent of U.S. crude production.