Pictures: Bakken Shale Oil Boom Transforms North Dakota

Enough Fuel to Burn

Photograph by Daniel Acker, Bloomberg/Getty Images

The Bakken Shale is giving up so much fuel that a significant share of it is being discarded—literally burned away in flares like this one earlier this year in South Heart.

Natural gas is a common by-product of oil production. Because gas is a useful and clean-burning fuel in its own right, that should bring additional value to each well being punctured in the Bakken Shale. But unlike crude, gas can't be carried off in trucks. And there are few pipelines in this energy frontier.

So about one-third of the natural gas produced from these wells is burned off, or flared. Failure to do controlled burns would be dangerous for workers and any nearby residents, and venting to the atmosphere would greatly increase the release of greenhouse gases. (Methane, the main constituent of natural gas, is 25 times more otent as a heat-trapping gas than carbon dioxide. (Related: "Methane: Good Gas, Bad Gas")

But the energy waste and emissions from the flaring have many concerned, and North Dakota is seeking other in-state uses for the natural gas. Worldwide, natural gas flaring had been on the decline until the oil boom in the Bakken Shale.

Published November 30, 2012

Pumping Station on the Plains

Photograph by Daniel Acker, Bloomberg/Getty Images

An oil industry worker mounts a staircase in a cavern amid pumping equipment and fluid storage tanks assembled outside New Town in western North Dakota.

Each well requires 1.5 million to 3 million gallons (5.7 million to 11.4 million liters) of water, pumped at high pressure into the shale rock to release the oil trapped within. Rig operators move hundreds of boxcar-like containers, like these seen here in February, from drill site to drill site. They haul in the water, chemicals, and sand needed for fracking, then need to haul out the wastewater.

It's the same technology that has spurred natural gas development in shales from Texas to Pennsylvania. (See related: "Forcing Gas Out of Rock With Water") But many energy companies have shifted to oil plays like the Bakken Shale in North Dakota, because the price of oil—and potential revenues—are so much higher than for low-priced natural gas. (See related interactive: "Breaking Fuel From the Rock")

Published November 30, 2012

Modular Worker Colony

Photograph by Ben Garvin, Reuters

Villages of low-slung modular buildings, like these seen outside Williston this year, have sprung up seemingly overnight in North Dakota.

Thousands of workers have flocked to the state's thriving oil patch, reversing years of declining population in many of its western counties. In fact, the influx has overwhelmed available housing in the sparsely settled area. The industry has been able to use modular buildings to set up "man camps" near the drilling sites.

With predictions for another 30,000 oil workers by 2020, the housing shortage continues to bedevil roughnecks and drillers, as well as highway workers and even teachers who can't afford to move into the area. (Related: "The Emptied Prairie")

Published November 30, 2012

No Place Like Home

Photograph by Jim Urquhart, Reuters

The operator of one of North Dakota's new "man camps" strolls among newly delivered housing units for oil workers near Watford City.

The trailer-like housing will likely remain in place for some time in the state's western counties, where housing stock had long declined as farmers moved to the cities. Even today's stepped-up housing starts won't keep up with population growth that could exceed 50 percent in some counties by 2025, state planners forecast. (Related: "Ghost Towns of North Dakota")

Published November 30, 2012

Four Walls and a Job

Photograph by Jim Urquhart, Reuters

Oil workers Matt Jensen, left, and Chris Skinner relax in a sparsely furnished dorm-like room near their work site near Watford City, North Dakota.

Accommodations in the Bakken Shale man camps are hardly posh, but some local officials are hesitant to encourage more permanent housing too quickly. Many remember that North Dakota was burned when another oil boom went bust in the 1980s.

But for now, the state's economy is surging. In 2011, North Dakota had the highest GDP growth in the nation, some five times the national average.

Published November 30, 2012

Pathway to Power

Photograph by Matthew Staver, Bloomberg/Getty Images

Crewmen lean into the job of welding a new gas pipeline near Watford City, North Dakota.

Along with oil, the state is producing more natural gas than it can capture or deliver, so workers are quickly building conduits like this one. Although the industry can make a handsome profit off its oil production, the same cannot be said about natural gas, which is selling at bargain-basement prices across the United States. So North Dakota is trying to find new markets for gas to discourage the industry from wasting the fuel by flaring it. The state is studying whether natural gas could be used to make anhydrous ammonia fertilizer for North Dakota's farms. Officials say they also might look at using the gas to produce petrochemicals, or liquid fuel for cars and trucks. The latter is difficult, because it requires engines designed to run on natural gas instead of gasoline. (Related: "Trading Oil for Natural Gas in the Truck Lane")

Published November 30, 2012

Tiger in the Tank

Photograph by Matthew Staver, Bloomberg/Getty Images

Oil worker Keith Ceynar transfers 240 barrels of crude—about 10,000 gallons (37,000 liters)—to a truck outside Alexander, North Dakota.

In the Bakken Shale, wells are often being drilled where no pipeline yet exists, so tanker trucks are the first mode of delivery for the oil.

Trucking companies that operate in the state complain that high pay in the new oilfield has worsened a driver shortage elsewhere. A similar shortage is seen in South Texas, where the same drilling technology used in the Bakken has given rise to a surge of oil production in the Eagle Ford Shale. (Related: "Smarter Trucking Saves Fuel Over the Long Haul")

In any case, producers aren't waiting for pipelines to be built in North Dakota. They're loading oil on railcars. Shipping by rail may become a fixture of the industry, the experts say, because it gives the oil industry flexibility to choose the best market for its crude. (Related: "Oil Train Revival: Booming North Dakota Relies on Rail to Deliver Its Crude")

Published November 30, 2012

Caged, and In Control

Photograph by Daniel Acker, Bloomberg/Getty Images

Amid monitors, cables, and metals, driller Jay Gunsch watches the controls on a rig near Watford City, North Dakota.

The workers rely heavily on computerized controls to drill some some 10,000 feet (3,000 meters) below the surface of the Earth. The bit must be turned horizontally to fully exploit the shale, which has a maximum thickness of 160 feet.

Even though it has been known for years that oil was locked in the Bakken Shale, it had not been considered an economically viable play until the innovation of combining high-volume hydraulic fracturing and horizontal drilling proved successful.

Unlike conventional reservoirs, where drillers have to hunt for sweet spots where oil and gas has accumulated, the Bakken and other shales cover large areas. When the U.S. Geological Survey (USGS) reassessed the Bakken Shale in 2008 in light of the new technology, the agency concluded that North Dakota held the largest potential oil resources in the 48 contiguous states. The assessment marked a 25-fold increase from the last USGS survey of the area in 1995, and was the largest oil resource ever assessed by the agency in which oil was dispersed throughout the rock.

Published November 30, 2012

A Prairie Transformed

Photograph by Ben Garvin, Reuters

New oil wells have carved a new look into the prairie near Watford City, North Dakota, as can be seen in this aerial view taken earlier this year.

Much of the drilling is being done on private land, and residents lucky enough to own mineral rights for a successful well are realizing new riches, earning perhaps $50,000 a month in oil royalties and some more than $100,000, David Unkenholz, a senior trust officer at First International Bank & Trust in Watford City told Reuters. But many neighbors get nothing, even for drilling beneath their own land. As in many states, surface and mineral rights were sold separately decades before the shale boom.

Published November 30, 2012