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Lynn Helms speaks on oil production

By Staff | Mar 16, 2012

Lynn Helms, director, ND Mineral Resources, Bismarck, spoke on oil production in North Dakota on Thursday, March 15 and the ‘hot spot’ in Bottineau County. He was sponsored by the North Dakota Farm Bureau.

Approximately 75 people came to learn about oil production and what its effects might be in the northwest part of the state.

Helms covered five points: resource plays, historical development and interaction points, activity, hydraulic fracturing, and 2012 rule changes.

The Tyler and Bakken formations are the biggest oil drilling areas in North Dakota. In comparison, the Spearfish formation near Bottineau is only about 200 square miles. It is a sour crude oil with a high sulphur content. It is not the same as the sweet crude from the Bakken.

The Bakken formation has the richest organic carbon, with layers as thick as 250 feet.

“When you get around Rugby, the layer thickness drops to 40 feet,” said Helms, comparing the two areas.

Helms pointed out that there is a ‘hot spot’ in the Spearfish formation near Bottineau that the experts are studying.

“The rocks are abnormally hot, sbut may not be deep enough,” said Helms.

Two of the questions to be answered at the Spearfish formation: Are the hot rocks mature source rocks? And how deep are they buried?

Helms talked about the issue of building a refinery in North Dakota. He believes that North Dakota will someday be able to support a refinery. First, the state has to increase its population to one million people. North Dakota’s current population is approximately 680,000 with the influx of oil workers. Helms said the state needs to produce 550,000 barrels a day in order to support a refinery here. He is talking about a large refinery that would employ 15,000 people.

“We don’t have enough gasoline to build a refinery in North Dakota,” said Helm. However, he added he believes we could increase the population to a million and work toward having a refinery here.

He talked about the need in North Dakota for the Keystone pipeline and other pipelines to keep oil product transported.

A person in the audience asked, “Is the state is looking at a pipeline from North Dakota to the south without Canadian involvement?” Helms said they are checking into that.

Helms says research shows that wells in the Bakken will continue to produce for 29 years. In those 29 years, one well will produce 580,000 barrels of oil and will bring into the state millions of dollars in tax revenue.

Helms predicts that by 2020 the oil production will produce 45,000 jobs for the state. However, there will be no housing for the people who come. He said western North Dakota is filled. He said towns across North Dakota have an opportunity to position their communities for housing these additional people. He said Hillsboro is already advertising for oil workers to come and live there.

Helms spoke for nearly 2 1/2 hour. He wrapped up talking about rules and regulations and encouraged those who have interests in the oil wells should also have mineral trusts.

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