Water authority decides on oil industry rate

Talk about it

A $100,000 Southwest Water Authority project could make Dodge, located in Dunn County, a hub for the oil industry’s water needs, and SWA’s Board of Directors approved an oil industry-specific rate at a meeting in Dickinson, Monday morning.

SWA shares an intake with Basic Electric Power Cooperative for the Antelope Valley Station. Water is pumped from that station to Dodge, to Richardton, then Dickinson where it is treated, said Mary Massad, SWA manager and chief executive officer.

“Along that raw water line is where we have some capacity to hopefully provide some water for the oil industry,” Massad said. “For probably a little over $100,000, we can put facilities in place for them to come and then they would have to build whatever they need to take it, which in our book is pretty cheap because to date, I think we’re at about $176 million that’s been spent on this project for construction.”

Massad said it is SWA’s hope that a facility can be constructed where water trucks could hook up, fill and drive away, completing the process within 10 to 15 minutes.

Massad said it’s her understanding that both the state and board of directors want to move forward with the Dodge project.

The project is estimated to be completed by spring.

Some water experts had reservations about the pipeline’s ability to provide such copious amounts of water.

Timothy Freije, Southwest Pipeline Project manager, said some oil companies near Dunn Center have advised they will be using upwards of 3 million gallons of water per day.

“I don’t think it’d be feasible for the project to serve that,” Freije said. “And it could cost $10 to $15 million to do that. Given a limited pool of funds to utilize, I’m more interested in serving Center than I am the oil industry, but it depends on the volumes that they’re talking about.”

Massad said there are no concerns with the amount of water slated to be pulled from Lake Sakakawea.

“We use about 1.6 billion gallons out of the lake (per year), that’s less than a half an inch,” Massad said. “On a hot summer day two to three inches will evaporate off that lake.”

Massad said annual allotments on groundwater use were exceeded last year.

“The ground water sources are permitted and they have an annual allotment and the issue this past year is everybody bumped up against that allotment and ran out of water,” Massad said.

Taking additional expenses into consideration, SWA’s Board of Directors hammered out a new oil industry rate.

SWA’s contract rate is at $3.17 per thousand gallons and the board of directors unanimously approved an oil industry rate of $8.11 per thousand gallons.

Before taking affect, the oil industry rate will need to be approved by the State Water Commission.

Some board members feel upfront contracts are the way to go.

“I think we need a commitment from them,” said Emanuel Stroh said, board of director member representing Dunn County.

However, obtaining these contracts may difficult as many oil companies budget short term, according to minutes from a Jan. 8 SWA meeting.

“As public entities, the industry may not want to purchase directly from SWA as then others may obtain their usage records,” according to the minutes.

Massad said it is the water authority’s hope that individual water sales will continue and the project would serve as an additional source.

In other business:

r After about $121,000 in costs incurred by SWA after a tornado and spring flooding, Federal Emergency Management Agency funds kicked in, covering all but about $14,000.

r As of Saturday, SWA had three generators still powering parts of the system due to massive power outages caused by a blizzard and ice.

Tags: southwest water authority, news