Oil riches pose environmental risks for North Dakota

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North Dakota’s crude oil and natural gas: From the Bakken to you

Oil boom leaves a trail of wastes, officials say

Valuable energy resource up in flames in North Dakota

WILLISTON, N.D. – Fly over Williston at night and you may think you’re passing a major metropolitan area dotted with thousands of tiny lights.

But in Williston, an oil boom town in the state’s northwestern corner, the population only recently topped 16,000. Those lights don’t line the streets of a bustling city. They’re flames, the signature of new oil fields where natural gas is burned off into the atmosphere.

The process, called flaring, is the disposal method for up to 30 percent of natural gas released as a byproduct of oil fracking in North Dakota’s Bakken shale formation. Fracking technology, which uses a mix of water, sand and chemicals at high pressure to open fissures in the shale, has allowed for a boom in North Dakota’s fossil fuels extraction. Without proper collection and processing infrastructure for natural gas, many companies simply burn it off.

Though widespread, flaring draws concern over environmental implications and the squandering of a viable energy resource.

(Carly Helfand/MEDILL)

But with between $3 and $4 billion currently being invested in pipelines and facilities to capture and process natural gas, officials say North Dakota should see a substantial reduction in flaring over the course of the next two years.

“While patience is a virtue, it’s been a challenge for a lot of people to see this thing through during this lag period,” said Scott Cramer, North Dakota’s public service commissioner. “But we are starting to see some relief, and I believe over the course of the next several months to a year and ultimately two years, we’ll see dramatic relief and people will feel better about it.”

Flaring incinerates more than 95 percent of the volatile emissions released through oil extraction that could react with other compounds to create ozone. The practice is preferable to venting those harmful emissions directly into the atmosphere, but the 140 billion cubic meters of flared natural gas worldwide in 2011 created 360 million tons of greenhouse gas emissions – equivalent to emissions from about 70 million cars, according to World Bank estimates.

Ideally, natural gas can be collected and processed to avoid any environmental exposure – with the right collection mechanisms in place. But that infrastructure can also be expensive, and the recent influx of natural gas from fracking is depressing prices across the market. Anti-flaring advocates have blamed companies for using flaring as a way to dodge costly development.

“The gas is a secondary product,” Cramer said. “It’s not what they’re drilling for, but that doesn’t diminish its value. It’s still an important commodity – it’s just a much lower-priced commodity and it’s a little more difficult to capture. Given that, we’ve seen a pretty significant lag over the last three to four years in putting in the infrastructure to capture and process and ship that gas to market, while the oil has gone fast and furious.”

But Ron Ness, president of North Dakota’s Oil and Petroleum Council, said the lag is justified, as companies have to understand the magnitude of the natural gas reserves before building pipelines and processing facilities for it.

“It’s kind of a chicken and egg thing,” he said. “You’ve got to get it so it’s sized right.”

Justin Kringstad, director of the North Dakota Pipeline Authority, also said he doesn’t know where the rumors about flaring got started.

“You wouldn’t see this being invested [in] if it wasn’t economical for these companies,” Kringstad said.

Wet and dry gas are collected together, and once the gas reaches a processing facility, valuable liquids such as propane, butane and ethane can be stripped off and transported to market separately. There, they can fetch prices twice as high as dry gas or greater.

“Natural gas liquids more than compensate for low dry gas prices. That liquid portion is really what makes it very attractive,” Kringstad said.

Several companies will soon be capitalizing on those liquids. Leading the pack is ONEOK Inc., which expects three new processing facilities – each with a capacity of 100 million cubic feet per day – to be on-line by 2014. Overall, the pipeline authority expects to see between 1.33 and 1.35 billion cubic feet per day processed by 2014, compared with just 780 million in 2011.

Kringstad said “numerous” other private construction projects are in the works as well.

“There’s no question [the liquid quality] has made it much more economically feasible and advantageous for private investment to take place,” Cramer said.

Although gas companies will be playing catch-up to existing oil drilling projects, Darius Frick, an area operations supervisor for Whiting Petroleum Corp., said many of the natural gas plants and large gathering lines are already set and that right now it’s the smaller, lateral lines from the wells to the plants that are going in.

“From this point on, it goes quickly,” Frick said. “It’s in the very beginning stages of development when there’s just a handful of wells in a field being drilled that your gas plants aren’t in place, your pipelines aren’t in place. But once a field is drilled and they get a pretty good idea as to what’s really there, then the infrastructure starts going in. It takes time to put in miles and miles and miles of pipeline, but once we get started and it’s in, then the gas comes to the plants quickly.”

Regardless of when it happens, a reduction in flaring will be welcomed by North Dakota residents who are watching an energy resource go up in smoke. Cramer said last winter, the state was flaring enough gas every day to heat 1,200 North Dakota homes for a year.

“We’re a cold state, so when we watch it being flared, we have a bit of a moral problem with that,” he said. “We are anxious to solve those challenges as well as produce an economic opportunity for North Dakota.”

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