How Important Is That Natural Gas That Is Being Flared Off In North Dakota? -- The Bakken, North Dakota, USA

Or to ask the question another way, how valuable is the oil being produced from the Bakken?

On the books, there is currently $1 - $3 billion in projects to capture that natural gas that is currently being flared.

The natural gas flared in North Dakota comprises about 4 percent of the value of the production and about 7 percent of the BTU'S the wells are producing. If you produce a barrel of oil from the Bakken, you have $80 worth of oil and roughly $6 worth of gas. North Dakota's tremendous growth of home-grown domestic energy is possible because we are able to begin production of oil in advance of the gas gathering systems and gas pipelines being completed, often a natural course in resource development. No one wants to capture the value of the natural gas more than the operators, so they work hard with industry partners to get the necessary infrastructure in place as quickly as possible.

Just putting things into perspective.

"All that natural gas" you see flaring accounts for "about 4 percent of the value of the production and about 7 percent of the BTU's the wells are producing." And you know the numbers were rounded up under the rosiest scenarios. As the price of oil heads back to $100/bbl and the price of natural gas remains where it is (or decreases), that "4 percent" decreases.

I look forward to the natural gas gathering projects, not so much for the reasons stated above, but for the jobs these projects will provide.

By the way, if you drive through an oil field with flaring all around you, what does that do to the local temperature? According to a local farmer, the temperature, based on the thermometer off his Ford pickup, went up about three degrees as he drove through a heavily flared oil field. Something tells me the wildlife will come to appreciate those flares come January, February, and March. The wildlife along the Alaskan pipeline has proliferated during to the warmer terrain around the pipeline.

Prudhoe Bay, about 50 miles west of the Arctic National Wildlife Refuge, the number of caribou has quintupled since production began in early 1978. The caribou often use the oil field equipment and the adjoining Alaskan pipeline for a windbreak and warmth. Much of the year the temperature in this region is a frigid 40 degrees below zero.

In New Mexico oil fields, many species of wildlife use equipment in a productive manner. Birds will use elevated surfaces as foundations for nests. Deer, like caribou, use the equipment for a windbreak and warmth.

Something tells me hunting is going to be heavily restricted once western North Dakota is dotted with oil wells. The wildlife will love it.

The natural gas gathering projects will make us all feel good, but the pipelines that really need to be laid, are those that would decrease the truck traffic.