Sanford opens North Dakota Energy Conference, talks about challenges, opportunities

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The Expo is being held at the Alerus Center and will run through Thursday, Nov. 13, finishing at 6 p.m. It brings together industry executives, producers, service providers and developers to discuss the state of energy production in North Dakota and to discuss the future of that production. Sanford touched on high growth and increased output of crude oil and natural gas in his remarks to the crowd of more than 100 industry executives and state politicians. He also spoke on how that growth benefited not only North Dakota, but the United States as well. He mentioned how North Dakota’s energy production has contributed to the United States becoming the world’s largest oil producer, which has been a “game changer” in a global geopolitical sense. An attack on an oil producing facility in the Middle East, for example, does not cause gas prices to rise in the U.S., he said. Production of oil and natural gas is at an all-time high in the state, with oil production reaching 1.5 millions barrels per day in August, and natural gas reaching 3 million cubic feet per day last month, according to Sanford. With the increased production comes increased revenues, with Sanford telling the audience that his hometown of Watford City in McKenzie County reached $1 billion in total oil and gas taxes for the fiscal year, according to the state tax commissioner’s office

The increase in revenue has led to more cash deposited in the Legacy Fund, which has yet to be determined how to be spent. An increase of money to the state’s Strategic Investment Fund, he joked, is easy to spend, with money going for, among other things, research at UND and NDSU. Despite the rosy outlook during some of Sanford’s remarks, he spoke about the challenges facing the future, including the transportation of oil. He pointed to the recent pipeline oil spill near Edinburg, N.D., in which more than 9,000 barrels of crude oil was sprayed over the ground. Sanford said transporting oil by pipeline is still the safest way to move oil, with by far the vast majority of North Dakota oil transported safely. He said the construction of new pipelines is necessary, to take the pressure off of existing and aging pipelines, and that his administration has a goal of “zero spills.” Another challenge facing the energy production sector in North Dakota is building a value-added economy — how to use the abundance of natural gas in the state versus shipping it to petrochemical companies out of state. With these challenges come opportunities, said Sanford as he referred to the petrochemical industry in Canada, calling the political climate in that country “not friendly” to the sector and saying that North Dakota has the opportunity “to raise its hand.”

Yet another challenge is advancing the infrastructure in North Dakota to the point that gas-fired power plants can be built, a challenge that will take all sides, from politicians to industry leaders, to landowners and taxpayers, to overcome.

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