"The Rich Are Different Than You and Me"

The rich have more money.

A misquote from Fitzgerald, but it provides an opportunity to opine.

Recently Harold Hamm, CEO/Continental Resources, with 22 rigs in the Bakken and clearly the "face" of the North Dakota Bakken, recently spent some time at the University of North Dakota.

CEOs number one problem is time management. They no longer have the luxury of mismanaging time like the rest of us.

Harold Hamm visited Grand Forks for some very specific reasons, I would opine.

He met with some "heavy hitters" in the North Dakota oil industry, but he could have done that in Dickinson, closer to where he was hunting pheasants, or Bismarck, where the Heritage Center and the NDIC are located. Mr Hamm has made significant contributions to the Heritage Center, and he obviously has an important relationship with the NDIC.

But he chose to go to UND. Among many other reasons for going there, he is looking for young talent, mostly in the form of geologists to join his company. He implied that CLR is looking to hire 40 more geologists. With the most rigs in North Dakota, 22 at last count, he definitely needs them.

He also talked about his estimate of recoverable oil reserves in the Bakken:

Hamm is more bullish than most on North Dakota’s oil potential.

He said Friday his company has done it’s own “scoping” of the Williston Basin's Bakken Formation spread across western North Dakota, eastern Montana and parts of Canada and figures it holds up to 24 billion barrels of recoverable crude oil. That is five times the estimate the U.S. Geological Survey made in 2008 about the Bakken's recoverable oil.

And it would make the Bakken a bigger play than the Prudhoe Bay oil field on Alaska’s North Slope, usually considered North America’s largest oil field with about 14 billion barrels of recoverable crude; most of it has been pumped out.

Mr Hamm also noted that North Dakota has the has the highest taxes on oil production of any of the oil –producing states and hopes they can be lowered and simplified so oil firms can plan for the future.

Regarding economic impact of the oil industry in North Dakota: Each well has an economic impact of about $120 million.

There are 164 rigs drilling in the state as of Friday, according to the state Department of Mineral Resources, meaning the total economic impact of the oil development in a year would be nearly $20 billion.

Finally, what would be the impact of halting hydraulic fracking as New York state recently did?

If that idea spreads to North Dakota oil fields, it would be a disaster, Hamm said.
“If there is a moratorium on fracking, we’d be done,” he said.

Hopefully, common sense prevails. Unlike fracking for natural gas, hydraulic fracking for oil occurs two miles below the surface, well below any aquifer.