A recurring theme or conversation one hears in North Dakota has to do with economic development beyond agriculture and oil/gas. It seems folks are struggling to find some industry that would fit the state, but they keep coming up against dead ends.
Until now.
The invisible hand of free market capitalism seems to be providing an answer that folks have been struggling to find.
I'm thinking of the fertilizer plants going up on the east side of the state,
Jamestown ($1.2 billion) and
Grand Forks ($1.5 billion).
Yesterday, MDU/MBI announces a $700 million-pipeline project to take natural gas from western North Dakota (the Bakken) to western Minnesota, but readers quickly noted that this same pipeline could carry feedstock to these fertilizer plants.
Now, Don, notes
this story in The Bismarck Tribune:
BNSF Railway is opening an economic development office in downtown Bismarck, Gov. Jack Dalrymple said Thursday.
Dalrymple
said the new BNSF office, in the Wells Fargo Building at 400 E.
Broadway Ave., will house economic development, sales and marketing
staff to enhance the railway company’s customer services.
BNSF Railway employs more than 1,500 people in North Dakota and has
hired more than 400 employees within the last two years, the governor’s
statement said.
It will only be a matter of time before we start reading stories about
BNSF shipping North Dakota fertilizer nationwide.
Note: the economic development center is not in the middle of the Bakken; it is not even in Minot where so much of its activity is located in North Dakota. It is not even in Minnesota. Which brings me to the next
story from The Dickinson Press:
With some of the state’s most prominent political
leaders looking on and close to 200 people packing the New Salem City
Auditorium, top executives from Minnesota Power/ALLETE touted their $500
million baby — a 50,000-acre network of over 100 wind turbines in
Oliver and Morton counties.
“We’ve been here and we intend to stay
here for the long haul,” said ALLETE CEO Al Hodnik. “North Dakota is
both energy rich, but, most importantly, policy-friendly. I can’t say
that about Minnesota, the state I grew up in, but North Dakota is good
for business and good for our company.”
I have not got one good word to say about wind energy. Wind turbines have NO redeeming feature in my mind. Activist
environmentalists know the devastating effect they will have on
migratory birds and if they can live with that, it's beyond me to say
anything else. It shows their true colors. Activist environmentalists are not interested in
the environment; they are interested in anarchy.
Having said
that, yes, the rapidity with which Bismarck makes decisions (or refrains
from putting up more obstacles) is incredible.
And, as I've said before, it gives the governor a seat at the table when the feds and the states meet to discuss energy.
Now, back to the original point: this trifecta is not trivial -- two billion-dollar fertilizer plants outside the oil patch; a three-quarter-billion-dollar pipeline to move feedstock to these plants; and, millions of dollars in railroad upgrades to move the fertilizer.
I've maintained for quite some time, developers are concentrating too hard on figuring out how to capitalize on opportunities inside the oil patch, but they are hog-tied by another trifecta: lack of workers; lack of infrastructure (particularly transportation); and very high-priced land in the oil patch. Eastern North Dakota, by comparison, offers a better opportunity.
I wonder if the fertilizer plants represent a tipping point in the transformation of North Dakota's economy? Fertilizer is not often thought of as related to the oil patch, and even without the Bakken, there will be sources of natural gas from Montana and Canada. It looks like the fertilizer plants may even push BNSF to a new level in North Dakota.
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Related:
The Dickinson Press is reporting:
For the first time ever, North Dakota is being recognized by Area Development Magazine for its permanent economic growth.
Released
Wednesday, North Dakota was one of 15 states to be honored with the
Silver Shovel Award given by the site selection and facility planning
quarterly. Four other states — Texas, Georgia, Alabama and Kansas —
received Golden Shovel awards for being the top in their population
category.
Each state had to pick 10 projects that represented permanent
economic growth for the state, Editor Geraldine Gambale said from her
Long Island, N.Y., office.
“We don’t include retail, commercial or
construction type jobs — things of that nature that would be
temporary,” Gambale said. “It’s based on high valuated jobs.”
The ONEOK pipeline project in McKenzie County was one of the 10 projects the North Dakota Department of Commerce submitted.