Oil companies are drilling a lot less in North Dakota than they were a year ago…
Today’s chart shows the number of active oil rigs in North Dakota. From 2011 to 2014, the number of active rigs held steady at around 190. Today, there are only 68 rigs operating in the state.
The number of active rigs has plummeted by two-thirds in just a year. That’s because it’s almost impossible for oil companies in North Dakota to make a profit when oil is $45/barrel.
The huge drop in production isn’t just creating problems for the state’s oil industry. The North Dakota Petroleum Council says that each active rig translates into 120 total jobs. The crash in oil could end up costing North Dakota’s economy up to 15,000 jobs.
This once-booming oil town is quickly turning into a ghost town…
If you follow the oil market, you may have heard of Williston, North Dakota. It’s small…home to just about 30,000 people. And it’s in the middle of nowhere…about an hour south of the U.S.-Canada border. But it’s also right in the thick of the Bakken Formation…
The Bakken is the second largest oil patch in the United States. It covers 200,000 square miles, making it about 20% bigger than the state of California. It holds an estimated 400 billion barrels of oil.
Oil companies have known about the Bakken’s rich oil supply for decades, but until recently, it wasn’t economical to drill for it. That’s because oil in the Bakken is trapped deep within rocks. It’s called “shale oil,” and it’s much more expensive to drill for than conventional oil.
But a few years ago, rapid advances in drilling technology and high oil prices made it economical to drill for shale oil. This triggered a huge U.S. energy boom.
Continue reading “Don’t Believe the Propaganda… This Golden Goose is Dead”
