The North Dakota Public Service Commission recently held meetings to decide the fate of the Dakota Access Pipeline, a line that will carry as much as 450,000 barrels of oil per day from the Bakken.
There is no question that our state needs the pipeline. Only a little more than a year ago, our state found its rail network congested, causing a backlog of shipments for agriculture and energy producers and driving up everyone’s cost to deliver product.
Today, we still are not far removed from this situation. While the amount of crude transported by rail is down, we could face constraints from inclement weather, high yields, growing production and rail construction, among other factors.
But increasing transportation capacity from North Dakota via pipeline reduces the potential for this congestion to happen. The completion of this pipeline in particular represents approximately six trains per day and well over half of the 700,000 barrels of crude transported by rail each day from the Bakken.
There exists further, though less calculable, value in developing a broad pipeline network for North Dakota oil. Pipelines are the safest, most-cost effective means of transporting crude. When the Bakken, as well as other shale-oil formations such as the Eagle Ford and Permian, drive down costs, American oil and gas producers are better able to stabilize production, in turn stabilizing energy costs for consumers, industry and agriculture producers.
Pipelines are vital for the success of our state. They can be constructed with minimal long-term impact to agricultural land. Thousands of miles of pipelines have operated with little impact for decades across the state.
And when pipelines are built, they free rail capacity and let our agriculture, oil, coal and ethanol industries grow, avoiding the loss of hundreds of millions of dollars when capacity is maxed.