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Oil boom continues

Department of Mineral Resources Director Lynn Helms presents oil production predictions at the North Dakota Association of Oil and Gas Producing Counties Annual Meeting at Medora Thursday. Oil production is expected to go up to 800,000 barrels a day by the end of 2011.

Bakken oil production is on the rise, and it doesn't look like it is stopping anytime soon, Department of Mineral Resources Director Lynn Helms said Thursday at the North Dakota Association of Oil and Gas Producing Counties annual meeting in Medora.

"We think it is going to go up for the next four years," Helms said. "There is no real evidence of a slow down in this thing."

North Dakota was producing 440,000 barrels a day in August, according to Helms. While some counties may not produce as much as others, Helms predicted that North Dakota could produce up to 800,000 barrels a day by the end of 2011.

The United States produces 5.5 million barrels a day. Helms said North Dakota will contribute close to 15 percent of the country's oil when it reaches 800,000 barrels a day.

"We will produce more than California and Alaska," Helms said. "Texas will be the only state to produce more than us."

A typical North Dakota Bakken oil well will produce for 28 years. Each well will produce 550,000 barrels of oil and generate over $20 million.

Rigs also play a large part in making jobs, Helms said. An oil rig needs 120 people and 2,000 trucks to serve it during the first year of life, Helms said. He added that each well built in North Dakota will create jobs for 30 years.

North Dakota can expect an additional 2,000 wells, 100 rigs, and more than 20,000 jobs by the end of 2011.

"200 drilling rigs needs 24,000 people just to keep them operating," Helms said. "As long as that rig is here in the state, 120 people will be here in the state servicing it."

Dunn County Commissioner Daryl Dukart said he expected the numbers he saw. At the same time, he realized how much impact the oil industry will have on North Dakota.

"We are looking at a tremendous impact to our road systems," Dukart said.

Flaring gas has been a concern for the Department of Mineral Resources, Helms said.

"It's a major energy source that is wasted," Helms said. "We're given the job of balancing and promoting gas and oil production versus preventing waste."

Helms laughed when he said people finally know where North Dakota is. Because of an oil boom, North Dakota has caught the media's eye.

"We are in the binoculars," Helms said. "Everyone is looking at North Dakota to know how to deal with this."

While other states are top producers in agriculture and technology, Helms said North Dakota's oil industry has pushed its economy.

"It is the thing that makes North Dakota stand out among the 50 states," Helms said.

North Dakota Association of Oil and Gas Producing Counties President Dan Brosz said knowing what North Dakota will produce is an important part of planning for the future.

"What Lynn brings to the meeting is an idea of what we can do to plan for the future," Brosz said. "It really helps us to look forward to what we can expect in the next couple of years."

Helms said this was an important meeting, adding the counties need to get as much information as possible

"The counties build for road budgets and school budgets off of what we project for oil production," Helms said. "This thing we do every year is critical to this organization, and it is critical to us."