For oil driller Harold Hamm, Bakken boom brings more billions and a chance to dabble in politics

(Michael S. Williamson/ The Washington Post ) - Harold Hamm at his Oklahoma City offices. He is a member of Mitt Romney’s energy advisory team.

(Michael S. Williamson/ The Washington Post ) - Harold Hamm at his Oklahoma City offices. He is a member of Mitt Romney’s energy advisory team.

Not everyone shares Hamm’s optimism. Oil output in North Dakota has jumped sixfold over the past seven years, perhaps the biggest single increase in oil output worldwide, but that hasn’t stopped prices from soaring. Hamm believes that the Bakken area holds 24 billion barrels, nearly as much as the proven reserves in the rest of the country put together — seven times as much as the most recent U.S. Geological Survey report (now being revised) and more than Prudhoe Bay. By 2020, similar geologic formations and drilling techniques could push U.S. oil production to 6.7 million barrels a day, a level not seen since 1994, says Barrington Research.

Even that wouldn’t be enough to quench U.S. consumption and fulfill Hamm’s vision of energy independence for America.

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The economy is booming in western North Dakota thanks to oil that is being extracted from a geological formation called the Bakken. People from across the country have flocked to the state to fill jobs in the oil industry. But new housing is not being built fast enough to keep up with this growth, making it difficult for newcomers to find affordable places to live. Longtime residents and landowners in the area also face challenges including possible displacement and the presence of oil companies on their land.

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‘A fantasy world’

Hamm explains his beef with Obama in personal terms. “I had hopes for President Obama as anybody in America did,” Hamm said. “I just felt like he had an open book.”

He says that he met with Energy Secretary Steven Chu to discuss developments in North Dakota and that the Nobel Prize-winning physicist took an interest in the advances in drilling technology. But Hamm says there was never any follow-up, and Chu stayed focused on promoting renewable energy.

Hamm says he was later part of a group that met with Obama and tried to impress upon the president the potential for new domestic oil supplies. “He just passed it off, I felt at that time,” Hamm says. He says that Obama talked about new battery technology and said that the country would soon be able to move away from fossil fuels.

“It was a fantasy world,” Hamm says.

That unabashed view of the virtues of oil differs from Obama’s position, which is to reduce oil use for national security purposes as well as to slow the pace of climate change. One of Obama’s first achievements in office was raising fuel efficiency standards for all American automobiles. If the United States is less dependent on imported oil today than it was a few years ago, that has as much to do with lower consumption as it does with higher U.S. oil production. Any prediction about reducing dependence on imports is based on expectations that U.S. oil demand may have peaked.

Yet Obama, like many executives at the nation’s biggest oil companies, may have underestimated the potential for higher oil output from North Dakota. Instead, he has talked of using natural gas as one way to cut oil consumption. Many city buses around the country sport logos about “this bus powered by clean natural gas.”

In Oklahoma City, Continental Resources has wrapped a few buses with the words: “Powered By American Oil.”

Striking it rich

Optimism and hard work are what made Hamm a quintessential American success story. His public relations person jokes that once people talk to the upbeat, personable oilman, they’re “Hammanized.” Even many of his political foes say he’s hard not to like.

After leaving Lexington, Hamm moved to Enid, a town north of Oklahoma City that was experiencing a small oil boom. He did a joint work-study program, pumping gas while finishing high school. It took up to 60 hours a week, and he wrote a paper about the Oklahoma oil industry success stories of the century. Inspired, he went to work for an oil service company and then for Champlin Petroleum, a major oil company at the time. Oil workers were, he recalls, “a different breed . . . charismatic, uninhibited.” After a few months, he went into the oil service business himself in 1966, starting out with one truck.

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