North Dakota To Surpass Alaskan Oil Production in 2012? We'll See -- The Bakken, North Dakota, USA

From the WSJ via Carpe Diem:

North Dakota will likely produce more oil than Prudhoe Bay in 2012.

It's possible we are already there; the most recent figures are two months old.

Actually, it will probably be in 2012 if the trajectories don't change.

North Dakotans fueling real estate boom in Arizona -- Perfect Storm

From USA via Carpe Diem:

Bakken fueling real estate boom in Arizona.

Tell me again the Bakken is inconsequential, which I heard over and over back in 2007, 2008, and 2009.

This is the USA Today link.

Flush with cash from an oil boom and plentiful jobs, North Dakotans are snapping up homes 1,500 miles away in balmy Arizona, where prices have plunged since the real estate bubble burst.

"It boils down to the weather and taking advantage of the market," says real estate agent Rocky Parra of HomeSmart Realty in Gilbert, Ariz., a Phoenix suburb.

He and wife Beverly, a native of Minot, N.D., have sold eight homes to North Dakotans in recent months. Parra is heading to North Dakota this month to meet with possible buyers.

"A lot of people have struck it rich," he says. "Oil companies are coming in and buying businesses and land. They're selling up there at the peak and buying down here at the bottom."

Can you imagine how robust the US economy would be if we had a) a pro-growth president; and, b) a non-activist EPA?

The oil boom in North Dakota is but one very small area in the entire United States. There is tight oil, tight gas reserves in a dozen other states, and then there is off-shore conventional reserves.

Too bad we don't have a "morning-in-America-Reaganesque" president. As big as the energy industry was in 2011, does anyone remember one positive statement made by the president regarding this industry? I don't.

But for NoDaks -- not only are some making a lot of money, but they are buying great property at severely depressed prices and best mortgage rates in history. 

By the way, when you go to the link, read about Blaine Bjella -- he made his money not in royalties, or oil directly, but ... well, go to the link. Some of it was being in the right place at the right time, but most of it was due to hard work.

Question for Those With Experience With Mineral Rights

I received this query from a reader this morning:

I notice you have a toolbar on mineral rights. I have a question that maybe you or your well-qualified bloggers can answer. I have three (3) mineral acres under a well south of Tioga. The well is about a year old and royalties have been running about 50 bucks a month. Two years ago a mineral acquisition firm offered to buy for $500 per acre. One year ago they upped to $ 1,100. Now they have offered $3,000 per acre.This is about 15 years of royalty and I don't understand its worth. Is it possible that a pooling or unitization plan for the Bakken in the future would make these minerals more valuable?

Let me know what you think.

My 2 cents worth: never sell minerals unless you really, really need the money or have another investment opportunity with that cash. Lease, yes; sell no. But I am inexperienced in this arena.

In addition, the area south of Tioga is "huge." I think bonuses of $7,000 could be expected in this area based on what I've seen in recent auctions. Possibly more. I think south of Tioga is better than southwest ND and the record in auction was $14,000/acre in southwest North Dakota, if I remember correctly.

Embargo -- Gasoline To $5 A Gallon?

Some weeks ago I was taken to task by a reader when I mentioned the word "embargo" with regard to Mideast oil.

For time-date stamp purposes: 9:24 a.m. EST, CNBC talking head says the sharp jump in the price of oil is due to .... well the crawler said: "Iran oil embargo."

Hmmmm.......

This could drive gasoline to $5.00/gallon.

Whether it does or not is open to speculation, but two certainties:
-- at $4.50/gallon, the EPA ain't gonna shut down fracking
-- at $5.50/gallon, we'll see a new president in 2013 (and a recession, if not a depression)

Fourth New Dorm To Be Constructed At Minot AFB --

I have to thank Don for forwarding me this link.

Some time ago I was taken to task by another reader suggesting that the economic impact of the two air bases in North Dakota was relatively inconsequential in the big picture. Maybe, I don't know. I suppose it's in the eye(s) of the beholder.

At the link:

Congress has approved more than $134 million in federal funds for Minot AFB construction. That amount includes the new dormitory.

This is the fourth new dorm to be built: two have been recently completed; one is under construction, and this will be the fourth new dorm.

In a military drawdown / contraction; the bases that "survive," not only "survive," but thrive. And grow. Remaining bases take on new missions, taking on missions from bases that closed.