Sunlight this morning brightened a fresh dusting of overnight snow, which complements the rime ice coating trees on the Capitol grounds following a week of persistently foggy weather.
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Burgum Touts Energy Sector Achievements
Gov Says State Offers "Boundless Opportunities"
North Dakota is "strong, it's growing and it's full of boundless opportunity," Gov. Doug Burgum proclaimed in his annual state-of-the-state message delivered Wednesday at the Chester Fritz Auditorium on the campus of the University of North Dakota in Grand Forks.
Burgum singled out the oil and gas industry for praise during his remarks, touting its innovation and the significant tax revenue it delivers to the state.
Click
here to listen to Burgum's comments.
Burgum described plans to make what he called "strategic investments" in infrastructure, referring to not just roads, bridges and municipal utilities, but the state's broadband network and the statewide buildout of the Unmanned Aerial Systems network
Click
here to listen to Burgum's comments.
Burgum suggested the funding source for some of the state's infrastructure investments could be earnings from the state's Legacy Fund. But noting that at some point in the future the oil tax revenue the state now depends on will be gone, he indicated support for reinvesting some of the earnings.
Click
here to listen to Burgum's comments.
In the 2019 Legislature, Gov. Burgum touted the idea of using Legacy Fund earnings to support the construction of the Theodore Roosevelt Presidential Library and Museum near Medora. The legislature opted for a different funding source, putting up $50 million in an endowment to support the project, to be matched with $100 million raised through private donations. It's clear the governor remains a big fan of the project, and said the state is well on its way to raising the money to get the library started.
Click
here to listen to Burgum's comments.
Click
here to watch a video of the governor's speech, including the music and other festivities that preceded it. Click
here to read a 32-page transcript of the Governor's speech.
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Panos to Counties: Let's Work Together
State and local government will be able to accomplish a lot more to improve North Dakota's transportation system by working together.
That was the message delivered by ND Department of Transportation Director Bill Panos speaking this week in Fargo at the annual meeting of the North Dakota Association of County Engineers. Panos said he's been working with Gov. Doug Burgum on a plan to reinvest in transportation infrastructure, which he said will include large structural investments, including projects at the county and city level.
Click
here to listen to Panos' comments.
Panos said the infrastructure plan would look to make "strategic investments" to give the state the biggest bang for its buck. He said improvements to Highway 85 in western North Dakota would be high on the list.
Click
here to listen to Panos' comments.
Drawing upon his previous experience in Wyoming, Panos encouraged local government to work with the state DOT to improve their chance of successfully obtaining federal DOT grant dollars.
Click
here to listen to Panos' comments.
Panos spoke highly of the Upper Great Plains Transportation Institutes's efforts in the state. Using an automobile analogy, he said "Upper Great Plains is like a Cadillac, and we intend to invest more and more and more in that program because of the great work that they're doing."
In closing, Panos said individuals who work in the transportation sector probably need to do a better job of telling the story of the importance of the work they do and services they provide.
"Transportation is the core of our economy," he said. "You actually can't have the energy economy in our state without a strong transportation system. It's almost like a utility, like power or water. You have to have it, and people really notice it when it's broken."
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McKenzie Electric Seeks Rate Relief
Co-op Suing Basin Electric Over DGC Costs
McKenzie Electric Cooperative notified its customers this week that it has filed a lawsuit against its wholesale power suppliers - Basin Electric Power Cooperative and Upper Missouri Power Cooperative - alleging their power rates are "unjust and unreasonable."
The lawsuit, filed in the Northwest Judicial District Court in Williston, accuses Basin of charging inflated rates to pay off losses at Dakota Gasification Company (DGC) and its associated urea production facility. The suit says that state law provides that Basin may only charge rates sufficient to pay the operating and maintenance expenses necessary for the “prudent conduct of its business.” (
NDCC 10-13-05).
The lawsuit claims that over the past six years Basin has lost $600 million or more from its "unreasonable and imprudent operation" of DGC, its for-profit synthetic fuels subsidiary. The suit says the natural gas it produces can only be sold at a loss, and that Basin’s strategy for addressing the problem was to invest more than $700 million in a urea plant to use the natural gas, but it has only made the problem worse because the urea plant has not been able to operate profitably. The lawsuit argues that Basin's rate increases "foisted the losses on the back of its members and customers."
To cover its losses at DGC, the suit says Basin raised its wholesale power rate by 22% in 2016, forcing McKenzie to charge rates "far higher than it should be charging." The result is that oil companies and some of its large industrial customers are looking to satisfy their energy needs through other sources, switching from electric motors to gas-powered compressors for their pipeline and processing operations.
McKenzie gets its power via Basin from Upper Missouri Power. The suit notes that McKenzie is locked into the power supply contract through December 31, 2075, and that Basin "flatly refused" to provide McKenzie a buyout number to free itself from the long-term contract.
The litigation was filed in November 2019 by the Johnson and Sundeen law firm of Watford City. In its response, Basin filed a motion to dismiss McKenzie's claim, stating the local cooperative lacks standing and the law provides no private right of action to enforce state law.
McKenzie has also filed a complaint against Basin with the Federal Energy Regulatory Commission, which Basin argued in its response has exclusive jurisdiction to resolve McKenzie's claims. Click
here to read more about the FERC case in the Minot Daily News.
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Belfield Seeks Input on School Project
Belfield Public School’s New School Committee is inviting the public to an informational meeting next week to discuss the possibility of constructing a new school.
The meeting will be held Wednesday, February 5, beginning at 5:30 MST in the school gymnasium.
Belfield Superintendent Daren Kurle said the current high school building opened in 1937, and is becoming increasingly costly to maintain. Kurle said there are visible cracks in the school's foundation, and its old boilers and steam heat are inefficient and often require expensive repairs. He said the building has had several additions over the years. The original two-story building had a third story added in 1941, another addition in the 1950s, and an area for agriculture classes was added in the 1970s. He said the newest school building in the district is its elementary which opened in 1979.
The Belfield district owns a 30-acre parcel of land that Kurle said could accommodate a new, single-story building covering 58,000-to-60,000 square feet.
"We want to build the most cost-effective, efficient school possible," he said.
Kurle said the public meeting will cover all aspects of the proposed project including a tour of the current building, current operation and maintenance costs, future needs of the district and funding options.
Click
here to see a flyer about the informational meeting. Click
here to see the Belfield School District's Facebook page.
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Here's the Source of Your Electricity
For the past several decades the bulk of North Dakota's power supply has been delivered by its seven lignite coal-fired generating units. But due to expensive federal regulations on coal facilities, an increasingly cheap supply of natural gas and generous federal subsidies for wind power, that energy mix has been changing.
North Dakota generation sources are dispatched either by MISO - the Midwest Independent System Operator, or SPP - the Southwest Power Pool.
The MISO region covers most of the Midwest, the Northern Plains, parts of the deep south and the province of Manitoba. SPP generally runs north and south through the Plains states including parts of North Dakota. Membership includes generation owners, utilities and large consumers in each region.
Both MISO and SPP have publicly-accessible websites that show users the generation mix at any given time. A glimpse of the MISO data over the noon hour today revealed this mix of generating capacity:
- Coal - 42.5%
- Gas - 35.06%
- Nuclear - 18.59%
- Wind 1.71%
- Other - 2.00%
- Solar - 0.13%
Click
here for the MISO data. Click
here to see the SPP generation mix.
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ND Coal Output Dips to 27.2 Million Tons
North Dakota’s five lignite mines produced 27.2 million tons of coal in 2019. Last year's production represents an eight percent drop from the 29.7 million tons mined in 2018 and 29.1 million tons mined in 2017.
The 2019 reduction was largely the result of major outages at various power plants, as well as the turnaround at the Great Plains Synfuels Plant during the past year.
“North Dakota’s five lignite mines continue to be a supplier of low-cost fuel for power plants,” said Jason Bohrer, president and CEO of the Lignite Energy Council. “The lower tonnage in 2019 also resulted partially from electricity produced from other sources including natural gas, wind generation and the Garrison Dam, which put pressure on lignite-based power plants in the state.”
The largest lignite mine in the United States – the Freedom Mine north of Beulah – produced more than 13.5 million tons of lignite and sold the coal to the Antelope Valley Station, Leland Olds Station and the Great Plains Synfuels Plant. North Dakota’s second largest lignite mine is operated by the Falkirk Mining Company near Underwood. It produced 7.4 million tons in 2019, which was sold to Great River Energy’s Coal Creek Station and Spiritwood Station. North American Coal Corporation owns the Freedom Mine, the Falkirk Mine and the Coyote Creek Mine.
The Center Mine, which is owned and operated by BNI Energy, Inc., produced 4.1 million tons in 2019. The mine supplies fuel to the Milton R. Young Station, which is operated by Minnkota Power Cooperative.
The smallest mine is Westmoreland’s Beulah Mine, which produced 418,000 tons for the Heskett Station, owned and operated by Montana-Dakota Utilities Co.
North Dakota’s seven lignite-based power plants generate enough electricity to serve more than 2 million families in North Dakota and surrounding states. Click
here for additional information about the seven coal plants. Click
here for information about North Dakota's five coal mines, as well as the Savage lignite mine in Montana.
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Oil and Gas Sector Employs 900,000
The U.S. oil and gas industry employed 895,629 professionals in 2019. That’s according to a new report from the Texas Independent Producers and Royalty Owners Association (TIPRO), which notes that the figure increased by 8,453 jobs from 2018.
Texas experienced the largest increase in industry jobs (5,550) in 2019, followed by New Mexico (758) and North Dakota (529).
The report showed that the largest increase in jobs in 2019 occurred in support activities for oil and gas operations with an increase of 6,284 positions, followed by oil and gas field machinery and equipment manufacturing with an increase of 1,056 jobs. The third largest gain came from the drilling sector with an increase of 704 jobs compared to 2018.
The oil and gas industry paid a national average wage of $114,745 last year, double the average private sector wage in the U.S. Employment in the oil and gas industry reached a high of 1,054,152 jobs in 2014, followed by a net decline in 2015 and 2016. But last year marked the third consecutive increase in oil and natural gas jobs since 2016.
Click
here to read more details in the TIPRO report.
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Williston API Planning Chili Cookoff
The Williston Basin API Chapter will hold its 39th Annual Chili Cook-off Saturday, February 8 at the Grand Williston Hotel.
The cookoff is one of two major fundraising activities for the Williston Chapter. More than 1,100 people attended last year's foodfest which featured 25 different types of chili. The charity event generated more than $60,000.
The money raised goes back into the community in the form of scholarships along with pledges to Giving Hearts Day, Dakota Boy’s Ranch, Boy Scouts, American Cancer Society Relay for Life, Salvation Army, Trinity School, Make-A-Wish, Upper Missouri Ministries and March of Dimes.
The cookoff runs from 3:00 pm - 11:00 pm at the Grand Williston Hotel. Click
here for additional details and sponsorship opportunities.
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Write it Down on Your Calendar!
WDEA 2020 Annual Meeting
Get this date on your calendar! The Annual Meeting of the Western Dakota Energy Association will be held:
October 7-8, 2020
The Grand Williston Hotel & Conference Center
Williston, ND
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State and Local Involvement Vital to the Census
State and local leaders and the citizens they represent should be involved with the 2020 Census because they will have to live with the results. The allocation of funding associated with many federal programs is based on state population figures.
Local participation occurs in two ways. First are enumerators who do the actual work for the Census Bureau; and second, local groups such as complete count committees that encourage the participation in the once-every-10-year process.
The Census Bureau is aware the response rate of households has been dropping over the past several decades. Nationally in 2000, only 74% of households responded to the initial census form sent to their homes. That rate further declined to 67% in 2010. North Dakota has seen a similar decline in response rate. In the 2000 Census, 78% of households responded, and in 2010, that number dropped to 74%.
This means about one-fourth of households in the state had to be counted with subsequent mailings or were counted when enumerators showed up at the home, knocked on the door and asked the questions in person. Educating the public about the safety and security of the census and the impact on local funding encourages participation, and is best accomplished by individuals who understand the process and the impacts to the local area.
The Census Bureau prepared a report titled “Census Barriers, Attitudes, and Motivators Study” that used focus groups to try to understand why individuals may be reluctant to participate in the census process. The reasons cited in the report include:
- Concerns about data privacy and confidentiality
- Fear of repercussions
- Distrust in all levels of government
- A lack of efficacy (did not feel it matters)
- Belief that completing the census could not benefit them personally
Other studies have found that the primary motivator of self-response across all population segments was community funding for public services.
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Census Committee to hold Workshop at BSC
North Dakota's Complete Count Committee has scheduled a workshop to be held at the Bismarck State College National Energy Center of Excellence on February 3 for Census volunteers and anyone who wants to know more about the impact the decennial event has on the state of North Dakota.
Registration opens at 9:00 a.m. for the event which is scheduled to run from 10:00 - 3:00. Lunch will be included. Attendees can expect to hear:
- Remarks from the Governor's Office and Commissioner Michelle Kommer
- Introductions from the North Dakota State Task Force and US Federal Census
- Breakout sessions by geographic region for formed and newly formed CCC's
- Media panel with updates and materials for your complete count committees
- Networking breaks to connect with others in your same position
Click
here to see the agenda. Click
here to register to get free tickets.
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REGISTRATION NOW OPEN
Williston Basin Petroleum Conference
After a long, cold winter it will be nice to see springtime and the 2020 Williston Basin Petroleum Conference scheduled for Bismarck. Along with green grass and spring temperatures, expect to see another excellent line-up of speakers plus a sold-out trade show.
The new conference
website features opportunities to enhance the participant experience and increase exposure. Registration is now open for the event scheduled for May 19-21. Click
here to register.
The website also features new information and features for exhibitors including an interactive map to allow vendors to select specific booths. Space will fill quickly so conference organizers suggest making plans now.
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Quick Connect
- Lawsuits ensnare Energy Transfer Partners, threaten projects -- E&E News
- Hess boosts 2020 capital spending on Guyana, Bakken ramp-up --Reuters
- Award-winning Fortis Energy Services looks to new decade of opportunity -- Oil & Gas 360
- 12 years and $10B later, ONEOK talks about its continued future in Bakken -- Williston Herald
- State issues $1 M penalty over blowout at well site, inspection violations -- Bismarck Tribune
- What’s coming up next for the Keystone XL pipeline in South Dakota -- Associated Press
- State mineral acre study to provide valuation in light of oil development -- Bismarck Tribune
- Montana, North Dakota delegation reacts to new Waters of the U.S. rules -- Williston Herald
- Governor, senators say trade agreement both a victory and benefit for ND -- Minot Daily News
- Comments sought on workforce development plan for North Dakota -- Bismarck Tribune
- Killdeer School Board discusses options for new school construction -- Beulah Beacon
- District 1 asking for energy grant to help with Innovation Academy project -- Williston Herald
- 2nd North Dakota Republican lawmaker announces state treasurer bid -- Bismarck Tribune
- League of Cities president Cymbaluk hopes to unite state for common goals -- Williston Herald
- Bighorns released on Ft. Berthold Reservation in 'nice homecoming' -- Bismarck Tribune
- Drilling down on new climate "news" platform; another dark-money news site? -- Energy in Depth
- U.S. has a new powerful tool to deal with Iran - the growth of American energy -- Inside Sources
- Elizabeth Warren's fracking ban would devastate the American economy -- National Review
- Activists prepping Congress to investigate energy companies on climate -- Energy In Depth
- U.S. proved reserves of crude oil increased to 47.1 billion barrels, up another 12 percent -- IER
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Factoid of the Week
North Dakota ranks third in the nation among the best states to raise a family. A study by a personal finance company looked at factors such as median family salary, housing affordability and state unemployment rate, among others. The best state for raising a family was Minnesota. The worst state: New Mexico. South Dakota ranked 11, Wyoming was 21, and Montana came in at 22.
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February 3
Bismarck
February 4
Williston
February 4
Bismarck
February 5
Belfield School Gymnasium
February 6
Bowman
February 8
Williston
February 13
Bismarck
March 6
Williston
March 16
Bismarck
February 18
Bismarck
February 19-20
Watford City
February 24-27
Bismarck
February 25-26
Dickinson
March 19-21
Minot
March 27-28
Bismarck
April 21-23
Four Bears - New Town
April 28-30
Watford City
May 19-21
Bismarck
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Oil prices and rig count
January 31, 2020
WTI Crude: $51.56
Brent Crude: $58.16
Natural Gas: $1.84
North Dakota Active Rigs: 54 (dn 2)
1/31/2019
-- 65 rigs
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Geoff Simon
Editor/Executive Director
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