November 27, 2009

Current oil activity may be the tip of the iceberg

Current oil activity may be the tip of the iceberg

With recent reports that a new oil formation called Birdbear was discovered and that North Dakota has now moved into fourth place among oil producing states, there’s a lot of optimism in the oil patch.
And Lynn Helms, the director of the North Dakota Department of Mineral Resources, couldn’t be happier. He is looking long term at robust oil activity that isn’t expected to dry up like it did in the 1980s.
According to Helms, the increased activity has oil companies exploring new options into marketing their oil to get top dollar.
“Some companies are looking into options for marketing their partnership share of oil from wells themselves versus having the well operator market it,” Helms said. “Especially as the time nears for the EOG rail facility (Stanley) to come on line and the unknown transportation costs associated with it.”
Right now, Helms said nothing has been set into stone and oil company executives are analyzing information. It could revolutionize the way oil is sent to market.
One way for that to happen is to pay drivers per load they haul as opposed to paying them per hour or on a set salary.
The New Town News wasn’t able to substantiate that claim, although Helms told the News that at this point, changing marketing schemes are just preliminary evaluations and may or may not happen.
If it does happen, current public opinion is that oil traffic on Mountrail County roads is going to increase dramatically to get that oil to market. It’s already nearing a breaking point, according to Three Affiliated Tribes Chairman Marcus Levings, who said in August that N.D. Highway 23 should become a four lane road because of the amount of traffic and increased risk of accidents.

The Weather Network