Sunday, November 4, 2012

Pipelines in the Bakken? The Story is Just Beginning

Link to the Dickinson Press.

The story is about the frustration, irritation, patience, relationships, etc., with regard to all the pipeline that is being laid in the Bakken.

But when you get past the human interest part of the story here are the data points and quotes:
In North Dakota, 74 percent of crude oil is gathered by truck and 26 percent gathered by pipeline, according to Kringstad. For Williams County, the ratio is 95 percent truck and 5 percent pipeline.
“That’s not sustainable,” said Lynn Helms, director of the Department of Mineral Resources. “That’s not a paradigm that we can live with long-term.”
But the process to obtain easements for pipeline projects is taking longer and becoming more expensive, Helms said.
The price to obtain an easement used to be about $25 per rod, or 16-1/2 feet, but now the price can be as high as $135 per rod, Dukart said.
The prices have risen similarly in Williams County, with landowners typically not accepting less than $100 a rod, Jorgenson said.
Five years of explosive growth in the Bakken and 95 percent of Williams County production is still "gathered" by trucks. I don't even know where to begin: there are so many story lines one could explore. 

6 comments:

  1. A concern of mine ( if i was a land owner with a gathering pipeline ) on it would be Who is going to remove this pipeline , and at whose expense when this oil field is done..Now i realize this amaybe 50-60 yrs in future and they are probably using plastic pipe so one should not worry about rusting.
    The interior of this pipe will always be coated with oil..The few $$ recieved today could cost a lot in the future..
    Also i would make a map, so i would know the location of this pipe.. many ranches out in western ND run water for miles to a Stock tank..

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    Replies
    1. These are the options I see:

      The EPA will establish a SuperFund for the entire state of North Dakota in 2080, funded by every oil-related company on a pro-rated basis, to remove the pipelines.

      OR:

      Al Gore's oil-eating algae company will pipe their product through pipelines no longer needed.

      Delete
  2. We own some mineral rights but not much. However, since we benefit from the North Dakota oil we have been very cooperative when it comes to easements for power lines, pipelines, whatever. We just take what is offered. I guess we're naive but we think that we need to be part of the solution.

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    Replies
    1. Interestingly enough, I would be just like you. I would be happy with what I was offered. A breath of fresh air. Thank you.

      Delete
  3. The reasons we do not take what are offered are:

    The term of easement is exceptionally long : 75 years.

    Unwillingness to give annual rental.

    There wording leaves you open for liability for their profit not yours.


    They generally run the math on about 1/2 the real estate value.


    Not concerned for mining, acess, or construction conflicts. Especially a problem if you have developable land.

    ReplyDelete