I'm way behind, so I won't link all the stories, but I've read several stories today about potential competition for oil patch resources: increased horizontal activity in the Niobrara in Colorado-Wyoming; the story I linked earlier today about increased activity in Montana; and a big story in today's news about increased horizontal activity in Oklahoma.
North Dakota legislators need to remember that it doesn't take a lot for drillers to move their operations elsewhere if taxes, regulatory environment, business climate, manpower shortages, etc., do not remain competitive. One issue in North Dakota regarding the oil industry particularly aggravates me but I won't bring it up now because I don't want to bring up any controversial items for the time being.
Right now, I see the biggest threat to on-going growth (maybe even the status quo) in North Dakota is competition from other areas in the Rockies and the Permian Basin, and the fracking manpower shortage. With the cash flow required to keep operations going, there probably isn't much room for error.
We may look back at the horrendous challenges to the oil industry in western North Dakota in 1Q11 (record blizzards, record snowfall, record flooding) and be thankful for the "stress test" -- much like the stress tests on banks.
No comments:
Post a Comment