Just six years ago, oil production from North Dakota’s Bakken region registered at a modest 6,000 barrels per day – and even that represented a high-water mark for the previous 12 years.
I mention this fact to communicate the impressive scale of the natural resource revolution spurred by innovative technologies that enable production from unconventional sources like shale and tight rock.
People know that the energy industry has dramatically increased domestic production of oil and gas the last few years, but by how much?
That’s the experience in the Bakken formation, where state officials announced that production in July exceeded 600,000 barrels of oil per day.
Think about that. What took the entire region more than three months to produce as recently as 2006 is now being brought online every single day in 2012.
What does this mean for the region? Jobs and economic activity. North Dakota enjoys the lowest unemployment rate in the nation at 3 percent. Tax revenues are pouring into state coffers as well.
This economic transformation and its benefits go beyond North Dakota.
A Federal Reserve Bank of Minneapolis report highlights the new demand for related products like sand, which is used to prop open tiny fissures in the rock created by the hydraulic fracturing process. The need for related products is creating jobs and growth even in areas not located over formations like the Bakken.
“In just a few years,” the report notes, “frac sand mining has lifted local economies—mostly in Wisconsin—by providing well-paying jobs, raising household incomes and pumping revenue into area businesses.”
The National Petroleum Council suggested last year that oil shale and tight oil formations could produce 2-3 million barrels of oil per day by 2035.
Given the dramatic recent increase in production from the North Dakota portion of the Bakken, it looks like we are well on our way.