Now-Operational Dakota Access Accelerates Bakken Revival

Drilling rig operating in North Dakota’s Bakken region.

Oil production in North Dakota’s Bakken region is expected to rise more than 20 percent this year just as the Dakota Access Pipeline comes online. By offering more affordable and diversifying access to key refining markets, the pipeline can help level the playing field between the Bakken and other U.S. shale plays that have benefited from better access to refineries.

Industry analysts like RBN Energy’s Rusty Braziel say the pipeline will cut shipping costs by $3 to $5 per barrel and amount to at least $540 million in annual savings for producers who previously relied on truck and rail to bring oil to market. “Economics for drilling in the Bakken will look better because of DAPL,” said Braziel.

Market players, including Hess Corporation CEO Jon Hess believe the $3.8 billion pipeline will accelerate output in the region, which reached its lowest point in almost three years last December. “We’re back to growth in the Bakken,” Hess said in a recent interview with Reuters, adding that his company this year plans to triple the number of drilling rigs operating in North Dakota.

Hess isn’t the only company beefing up operations. In fact, the drilling rig count in North Dakota has risen 40 percent since the Trump administration gave the final green light for the project and is forecast to jump another 10 percent or more by years end.

This production bump is not only a win for American energy independence, but also for the State of North Dakota which is expected to gain $100 million or more in annual tax revenue, according to a recent Associated Press report.

Dakota Access To Set New Course For N.D. Oil

Completion of the Dakota Access Pipeline is expected to fundamentally change the direction of North Dakota oil.

The “interstate highway” for Bakken crude will take barrels off the rail cars headed east-west and take them south to refineries on the Gulf Coast, where experts expect oil producers will find higher prices and lower transportation costs.

“It is going to certainly shake up the existing transportation modes,” said Ron Ness, president of the North Dakota Petroleum Council.

The $3.8 billion, four-state oil pipeline will connect the state’s oil fields to a pipeline in Illinois that leads to refineries in Texas. It could ultimately carry up to 570,000 barrels a day. For months, construction stalled as the Standing Rock Sioux Tribe and its allies filed legal challenges and protested in southern Morton County, expressing concerns that a leak may contaminate the tribe’s water supply.

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Dakota Access Pipeline Is A Milestone For ND Energy Development

The demonized Dakota Access Pipeline will go into service soon, likely early this week, and will begin delivering 470,000 barrels of Bakken crude oil every day to a distribution hub, providing better access to important markets. In all the pandemonium over the pipeline, with months of noisy protests, the importance of the pipeline to North Dakota has been overshadowed.

The Dakota Access Pipeline will make North Dakota’s roads and railroad crossings safer, a big plus for public safety. It has the capacity to eliminate 500 to 740 rail cars or more than 250 trucks each day.

The $3.8 billion pipeline will bring as much as $100 million a year in additional tax revenue to North Dakota, a welcome infusion as the state struggles with low prices for energy and farm commodities. It will transform the economics of oil production by reducing transportation costs an estimated $3 a barrel. By increasing the competition among existing pipelines, it will help to further alleviate transportation costs. High transportation costs have long dogged Bakken producers.

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New Ranking Finds North Dakota Has No. 2 State Economy in the U.S.

North Dakota has the No. 2 best economy of any U.S. state and is No. 1 for job growth according to U.S. News & World Report’s 2017 Best States rankings. The annual survey, which ranked North Dakota No. 4 overall, said growing energy production and robust infrastructure were key to the state’s strong performance.

The Peace Garden State has benefited greatly from being at the epicenter of the U.S. shale oil boom. In 2004, oil and gas production accounted for just 2 percent of state’s economy, but by 2014 it was almost 16 percent. Several years ago, while much of the nation was suffering from hard economic times, North Dakota was attracting billions of dollars in investments and workers from around the country.

While falling oil prices have weakened production, North Dakota is still producing over a million barrels a day and has one of the lowest employment rates in the nation. The Bakken boon may have hit slow patch in the road, but the promising opportunities and benefits derived from this remote region are far from over.

Most recently, an analysis by the Associated Press found that cost savings provided by the Dakota Access Pipeline will not only benefit producers, but also amount to a more than $110 million gain in annual tax revenue.

This staggering increase has already lead the state’s budget director to begin crafting spending plans that take the added revenue into account and perhaps leading the state to become the No. 1 economy in the years to come.

AP: Dakota Access Will Support $110M Increase In Annual Tax Revenue

A new analysis by The Associated Press finds that North Dakota will gain over $110 million annually in tax revenue after oil begins flowing through the Dakota Access Pipeline. The $3.8 billion pipeline, which is set to come online later this month, will provide a safer, cost efficient avenue for Bakken drillers to ship product to key refining markets in Illinois and the Gulf Coast.

North Dakota in the past decade has become the second-biggest oil producer in the United States, behind Texas. But its location in the northern Plains, far from major oil markets, means less profit on each barrel of oil. North Dakota lowers its tax on each barrel to keep its crude competitive with other states.

Much of North Dakota’s oil is shipped by truck or train. The 1,200 Dakota Access pipeline would carry the oil through South Dakota and Iowa to a shipping point in Illinois. It could shave shipping costs by more than $3 a barrel, according to Ron Ness, president of the North Dakota Petroleum Council. State tax officials estimate every dollar saved means about $33.6 million in added tax revenue each year.

In addition to oil tax revenue, the Dakota Access Pipeline also stands to generate upwards of $55 million annually in property taxes, including $10 million in North Dakota. “It’s going to benefit schools and counties and more valuation means lower property tax bills for everybody,” said North Dakota tax commissioner Ryan Rauschenberger.

North Dakota Governor Issues Emergency Evacuation Order for Protest Camps

According to a report from the Dickinson Press, North Dakota Gov. Doug Burgum ordered the mandatory evacuation of Dakota Access Pipeline protesters stressing the dangers of spring flooding and the need to avoid environmental damage. The report followed an official release from the Governor’s Office, and a release from Sen. John Hoeven which stated that the U.S. Army Corps of Engineers will have a crew on site by the end of the week to assist in cleaning up the area.

The order requires the evacuation of everyone currently occupying the Corps of Engineers land along the Cannonball Rivers in Morton and Sioux Counties citing the threat from human and inorganic waste left behind by protesters who have gathered at the site for over half a year.

The waste “pose[s] a significant and increasing environmental threat to the waters of Missouri River if cleanup and removal efforts are not quickly accelerated and completed before flooding begins.”

The order follows an earlier statement from the Governor’s office which said “It is paramount for public safety, and to prevent an environmental disaster, that the camps be cleared prior to a potential spring flood. Once the floodwaters recede, the land will need to be cleaned and eventually restored to pre-protest conditions.”

What Others Are Saying on the USACE’s Decision to Grant Final Dakota Access Easement

In addition to MAIN Coalition spokesman Craig Stevens’ statement, the following MAIN Coalition members also issued statements following the release of the final easement necessary to finish construction of the Dakota Access Pipeline by the U.S. Army Corps of Engineers:

Ed Wiederstein, Chairman, Midwest Alliance for Infrastructure Now (MAIN) Coalition said, “The MAIN Coalition is pleased that the U.S. Army Corps of Engineers has decided to move forward with the final easement – thus ensuring the completion of the long awaited Dakota Access Pipeline. We thank the U.S. Army Corps of Engineers for their hard work and deliberation on this project which allowed for this important decision to be reached, and we thank the Trump Administration for moving this project forward.”

Bill Gerhard, President,  Iowa State Building and Construction Trades Council said, “The decision to grant the final easement for the Dakota Access Pipeline following an extensive and thorough review has been eagerly anticipated by thousands of hardworking men and women. We applaud the U.S. Army Corps of Engineers for their decision to issue the final easement.”

Andy Peterson, President, North Dakota Chamber of Commerce stated, “With the issuance of the final easement at Lake Oahe, our state can put the long saga of Dakota Access’ construction behind them and look forward to operation of this important pipeline project. Our state relies on a stable and lawful regulatory climate to ensure business transactions can occur unencumbered by political interference – the Corps’ engineering decision to grant this easement is a positive step forward for both the project and North Dakota.”

 Ron Ness, President, North Dakota Petroleum Council said, “The U.S. Army Corps of Engineers’ decision to grant the final easement to the Dakota Access Pipeline is a welcome decision for both the oil and gas industry, as well as for businesses and individuals across North Dakota. Our state has waited a long time for this final easement, even following approvals by our own Public Service Commission, and endured months of divisive and disruptive protests. We thank the Corps for their expedient decision following a directive from the Trump Administration to ensure the lawful regulatory review process is carried through to completion.”

Mike Ralston, President of the Iowa Association of Business and Industry stated, “The Iowa Association of Business and Industry thanks the U.S. Army Corps of Engineers for their decision to move forward with the Dakota Access Pipeline. The directive issued by the Trump Administration only a few short weeks ago sought a lawful conclusion to the long process of pipeline approval and we are thankful that we will see the completion of the project soon.”

Dawna Leitzke, Executive Director, South Dakota Petroleum and Propane Marketers Association said,  “The South Dakota Petroleum and Propane Marketers Association applauds the decision by the U.S. Army Corps of Engineers to issue the final easement for the Dakota Access Pipeline. South Dakotans look forward to the completion of this important infrastructure project and a step toward a future of American energy independence.”

Tribal Council Supports Asking Protesters to Leave Cannonball

FORT YATES — The Standing Rock Sioux Tribal Council unanimously voted to support the district of Cannon Ball in asking all Dakota Access Pipeline protesters to leave the area and canceling plans for a nearby winter camp.

“All the individuals at all the camps in and around Cannon Ball need to leave the district,” residents wrote in a 10-point resolution passed during an executive session of a district meeting Wednesday night. “The building of an alternative site for the camp(s) within the Cannon Ball District is not needed or wanted. If there is to be any kind of a ‘site’ for the commemoration of this historic event that took place with all the tribes, the people of Standing Rock need to vote on where, what and cost before any ‘shanty town is built.'”

The resolution, approved by the full council Friday, applies to all of the protest camps in the area: Oceti Sakowin, Rosebud and Sacred Stone.

The majority of those from the camps who spoke said they respected the council’s decision and shook hands with them.

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New Year, More Arrests

Protests continue against the Dakota Access Pipeline and protesters continue to violate laws across the country, engaging in dangerous actions to draw attention to their causes.

In North Dakota five people were arrested on Tuesday December 27 for trespassing after crossing the Cannonball River onto Army Corps land, the Morton County Sheriff’s Department said in a statement on Wednesday. Later in the evening, law enforcement said a group of around 100 protesters gathered on a bridge that was the site of previous demonstrations and police fired sponge rounds at people attempting to remove a “No Trespassing” sign according to a Reuters report.

Morton County Sheriff Kyle Kirchmeier said in the statement, “actions by protesters yesterday are proving they are not willing to be peaceful, and are certainly not respectful of our mutual agreement.”

But North Dakota isn’t the only site of these actions, two Dakota Access Pipeline protesters unfurled an anti-DAPL banner from the rafters of US Bank Stadium in Minneapolis during a game between the Minnesota Vikings and Chicago Bears on New Year’s Day. The banner included a U.S. Bank logo with the word “divest” written vertically down the banner. At the bottom, it said, “#NoDAPL.”

According to police, the protesters demanded the media be present when they came down from the rafters. Once down, they were taken to jail and charged with trespassing.

Jay Timmons: From Day One, President Trump Should Focus On Strengthening Our Energy Security

In an opinion piece by Jay Timmons, president and CEO of the National Manufacturers Association and David Taylor, president of the Pennsylvania Manufacturers’ Association, the authors highlight the importance of the Dakota Access Pipeline as a part of broader American energy security.

This should be a Day 1 priority for the incoming Trump Administration.

“There are no shortcuts to creating a climate that fosters job growth and strengthens manufacturing, but investing in our country’s energy infrastructure is a good place to start.”

The controversy that arose during the Dakota Access Pipeline allowed for an environment of political interests to supersede the needs of America’s energy future and the needs of American workers. But with promises to end the “business as usual” attitude that pervades Washington DC, President-elect Trump has a head start with the promise of this important energy project.