North Dakotas Oil Boom

I guess I am posting this as an observation from a non-resident perspective, “Just a heads up”.

I have been hunting and fishing out in ND for the last 10-15 years. I have always marveled at the scenery, weather it was walking the prairie for pheasants, or sitting in a slough for ducks, or fishing on the Mighty Missouri River. I always have had a sense of peace inside me when I am out there, I can’t help but imagine back in time what was once there, and I appreciate what is still there now.

Another jewel in ND is its residents; they have always extended a friendly hand, and a smile. On my first duck hunting trip in ND, I rented a home on a farm from a local farmer who I had never met before; we were staying in a home on his property. After the first day of hunting we returned to the house and found two freshly baked pies waiting for us on the kitchen table. Needless to say we returned for many years after. If you ever have traveled through the back roads of ND you will know that any vehicle that has ND plates will wave a friendly hello.

So I just came back from a trip up to Garrison ND, right off the bat as a traveler you notice something different, there is a significant increased of truck traffic on HWY 94 traveling westbound. They are hauling heavy equipment, brand new campers, mobile homes, and tankers. As you watch the oncoming eastbound traffic the flatbeds are empty, there are none of the camper trailers returning, and no equipment is headed eastbound. It’s the impact of the oil fields that you see.

What you don’t see is the impact that this amount traffic is having on the ND prairie.
Yes there is a major economic impact for those who benefit and profit from this boom.
And if you have been a visitor to this area it is needed and well deserved, however there are also impacts that may alter this prairie state forever. I am being selfish here I guess, but I sure hate seeing the changes. Not only are there major changes going on to the landscape, there are major changes that are going on for the residents, not all so beneficial.

I picked up a local paper and started reading about all the rising problems, things that you don’t think about, and some that you do. Increased crime, increased poaching, decreasing available homes for residents. The mobile homes and camp trailers are packed in to small areas called man camps. One particular story is about the amount of trash and litter that is accumulating in the road side ditches, local residents are having to deal with the clean up
I am not sure if the residents are completely agreeing with the pace of the boom and trying to keep up with its impacts.

Although I embrace the benefits, I have regrets for the results that will come from this boom. And sympathy for what all ND residents are going through. . A little bit of the old west is disappearing right before our eyes.
So as a non resident, it is with sincere a hope that as you grow, you do not lose what ND is and always has been.

Progress…..?????

Trust me – this won’t last forever.

Boom and Bust cycles are all part of the Oil driven economy.

What is crazy is try to rent a hotel room in ND for your Fall hunting trip. What was once $39 is now $339. We are now “campers” in the grasslands.

Dog

I have a similar feeling about those God awful wind turbines.

This boom will be relatively short lived, once the rigs are in place things will settle down. That’s the reason the housing that they are using up there is temporary, easier to clean up after everyone leaves.

The other “boom” that is now “bust” is the ethanol build out.

These plants are now being sold for scrap or are idled…

Dog

I think the new jobs it brings and the oil it brings far outweigh the negative. I was actually thinking of moving up there for work. I have a buddy that is making some pretty nice coin working there.

Until very, very recently this industry was doing OK to even well at times. However, the bottom has dropped out on ethanol while corn prices remain strong. The gas/ethanol industry has a huge surplus right now. So much so, there is little availability for storage around the country. Funny though, we don’t see gas prices going down like we do ethanol.

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The other “boom” that is now “bust” is the ethanol build out.

These plants are now being sold for scrap or are idled…

Dog

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Second that. There were 2 ethanol plants that were built here in Iowa that went bankrupt. I think they need some more subsidies.

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The other “boom” that is now “bust” is the ethanol build out.

These plants are now being sold for scrap or are idled…

Dog

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Second that. There were 2 ethanol plants that were built here in Iowa that went bankrupt. I think they need some more subsidies.

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Yep, that is exactly what happens when the government tries to push products and services in the free market that it chooses. Subsidies, regulation and taxing the competition never works to force something that the market doesn’t want. The bottom line is we want cheap quality products.

(I think I need a comma there)

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Second that. There were 2 ethanol plants that were built here in Iowa that went bankrupt. I think they need some more subsidies.

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Many ethanol plants went bankrupt 4 years ago when corn was speculated to go over $7. A bunch of folks hedged on that and bought in at $6.00 – $6.50 only to have corn quickly drop back down to $3.50. Unfortunate for those who invested in those companies.

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Until very, very recently this industry was doing OK to even well at times. However, the bottom has dropped out on ethanol while corn prices remain strong. The gas/ethanol industry has a huge surplus right now. So much so, there is little availability for storage around the country. Funny though, we don’t see gas prices going down like we do ethanol.

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Only due to the stupid subsidies. Ethanol has always been a joke imo. I despise it and wish I weren’t forced to freaking buy it.

The subsidies expired a while ago… FYI: The ethanol producers didn’t get the subsidies. The blenders did, so mostly your BP’s and Shells of the world got those tax credits on top of the already outrageous tax credits they get today.

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Until very, very recently this industry was doing OK to even well at times. However, the bottom has dropped out on ethanol while corn prices remain strong. The gas/ethanol industry has a huge surplus right now. So much so, there is little availability for storage around the country. Funny though, we don’t see gas prices going down like we do ethanol.

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No……government intervention stopped……Funny how a market propped up – falls to earth – when the dollars are removed. It was never going to stand on its own, North of the Equator. Not enough sugar and too expensive to process the corn to ethanol.

Never was going to work. Doomed from inception.

Dog

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The bottom line is we want cheap quality products.

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How about American made products? How about alleviating our dependency on foreign products?

I see posts on here all the time pushing patriotism and American made this and that etc… Yet, when we have an opportunity to provide local skilled labor jobs, taxes to cities and states & guaranteed industry support for our farmers many want to poo poo it.

Don’t burn food, eat it. Illinois has similar gas/oil reserves in the southern part of the state and we choose not to expore them. I sympathize with the associated problems but when you have jobs, people are going to flock to you quickly. I wish the rest of the US was a productive as ND.

I don’t know why, but a quote from Charlton Heston comes to mind,”Only man is arrogant enough to believe he can destroy the world”. There is so much truth in that statement I won’t even get into it.

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Don’t burn food, eat it.

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You eat yellow #2 corn??

Back to the original post, Jeff, I enjoyed reading your post.
Things are changing out there, but the oil boom has accelerated it.

This is not a new fangled gas they are pumping, this is oil. It will be interesting to see if it busts. In order to do that, the price of world oil would need to drop significantly and with the growing international demand, I just don’t see it in the near future.

But, back again to the original sentiments, if you’ve never had the pleasure of hunting ND and the feeling of being absolutely alone with your thoughts, hurry up!!

I agree with the fact that ethanol is completely pointless. It will be very very interesting to see what corn prices will do with all the weird weather this year compared to the 12 million acres of CRP ground that were planted into corn. Corn was predicted to be in abundance this fall, but with all the rain and drought in certain areas, this may not be so. All in all ethanol sucks I would rather eat US #1 Yellow Corn with a little FM than watch it be made into ethanol Grain grading!

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Back to the original post, Jeff, I enjoyed reading your post.
Things are changing out there, but the oil boom has accelerated it.

This is not a new fangled gas they are pumping, this is oil. It will be interesting to see if it busts. In order to do that, the price of world oil would need to drop significantly and with the growing international demand, I just don’t see it in the near future.

But, back again to the original sentiments, if you’ve never had the pleasure of hunting ND and the feeling of being absolutely alone with your thoughts, hurry up!!

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Only due to the stupid subsidies. Ethanol has always been a joke imo. I despise it and wish I weren’t forced to freaking buy it.

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AMEN

I’ve hear rumors this is just a start. That many other areas of the US have places where “fracking” will be used. I was told that many are looking at ND as a model on how to do it better when it comes to infrastructure etc… I have no idea if my source is reliable.

Got some friends and family members up there now taking advantage of the boom. Sounds miserable hearing about the crime and man camps.

Sorry to get off track Jeff, while my heart is in the good Dakota just south of ND. I do understand your sentiment completely!

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The subsidies expired a while ago… FYI: The ethanol producers didn’t get the subsidies. The blenders did, so mostly your BP’s and Shells of the world got those tax credits on top of the already outrageous tax credits they get today.

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Doesn’t matter who they actually went to. The subsidy to the blender resulted in higher demand for the crap which results in higher prices for the crap than they would have gotten.

Add in the fact that I am forced to buy the crap …this also results in an artificially high demand which again results in a higher price for the crap. Bottom line, ethanal is crap .

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It will be very very interesting to see what corn prices will do with all the weird weather this year compared to the 12 million acres of CRP ground that were planted into corn. Corn was predicted to be in abundance this fall, but with all the rain and drought in certain areas, this may not be so.

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Grain prices in general are going to remain high by historic standards. Not because of ethanol or any specific weather situation, but rather because global demand has finally caught up with supply. This has happened in ways that the average person who’s not involved in the ag industry doesn’t often think of.

Most people think of direct consumption of ag products as being a driver, ie a grower produces something that is eaten directly. In reality, the driver of prices is often indirect.

As an example, economic booms in both China and India have dramatically increased the amount of domestic livestock production in these countries, specifically in terms of poultry production in India and pork/beef/dairy production in China.

The challenge is that neither of these countries produces anywhere close to enough to feed all these new animals that are now part of the production chain. Also, once you start large scale livestock and dairy production, it is very costly and difficult to stop even if feed prices go against you. Therefore, it’s no longer a case of “if” the Asian market will buy, it’s when and how much.

But don’t all rush out and get into farming. The average Joe believes farming is WILDLY profitable for the farmers, but in reality it’s a very difficult business and in a lot of ways similar to the grocery business where margins are razor thin and everything has to be done in huge volumes.

As usual, the downside for producers is going to be continued record high prices for inputs, namely fertilizer and seed. For livestock producers, feed costs have been very high and strong demand has been good for selling prices, but producers are often buyers and sellers, so they are buying high and left hoping and praying that the prices will hold.

Grouse

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You eat yellow #2 corn??

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of course that’s not the food I should eat
it’s the food my food should eat

Please don’t bring facts into this discussion!

OK, I’m done going off track.

Lets make drinking whiskey instead of car fuel. I’d be glad to use more.

As someone who works in the Ag industry, farmers, at this time, are wildly successful.

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Back to the original post, Jeff, I enjoyed reading your post.
Things are changing out there, but the oil boom has accelerated it.

This is not a new fangled gas they are pumping, this is oil. It will be interesting to see if it busts. In order to do that, the price of world oil would need to drop significantly and with the growing international demand, I just don’t see it in the near future.

But, back again to the original sentiments, if you’ve never had the pleasure of hunting ND and the feeling of being absolutely alone with your thoughts, hurry up!!

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Spot on Cougareye

That sleepy little town out west is not so easy to stay at anymore.

Its as simple as black and white

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The bottom line is we want cheap quality products.

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How about American made products? How about alleviating our dependency on foreign products?

I see posts on here all the time pushing patriotism and American made this and that etc… Yet, when we have an opportunity to provide local skilled labor jobs, taxes to cities and states & guaranteed industry support for our farmers many want to poo poo it.

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America builds quality, but they can’t do it cheaply. Our standard of living is too high. Don’t take that as me say we need to lower the standard of living. But between labor and the cost of resources, it jacks up the price. And don’t take that as saying we need lower wages. Its just the facts. America is still the most industrious and innovative nation, but once they come up with a great product, it is just cheaper to make it over seas.

If someone can solve that problem, that would be great.

To the original post, I’m from ND and have been out here for 13 years now. For the economy the boom is good but for what it’s doing to the people it’s not so good. Crime is going up and most are less friendly towards new comers. It’s to be expected but at the same time it’s a shame. ND was and is a great state with incredible people there.