Oil Patch: An economic disaster area?GRAND FORKS — Reflecting a growing concern about the pace and scope of western North Dakota’s oil boom, a weekly newspaper editor in northwestern North Dakota recently appealed for the state to declare the region “an economic disaster area” because of the burgeoning oil industry.
By: Chuck Haga, The Dickinson Press
GRAND FORKS — Reflecting a growing concern about the pace and scope of western North Dakota’s oil boom, a weekly newspaper editor in northwestern North Dakota recently appealed for the state to declare the region “an economic disaster area” because of the burgeoning oil industry.
Cecile Krimm, editor of the Crosby Journal, wrote that the economic crisis facing the area is “a societal disease characterized by skyrocketing rents, an inadequate labor pool and the complete overwhelming of existing public infrastructure.”
She suggested that the state cap the number of drilling rigs that can
be operating at any one time and take other steps to slow the pace of development.
“This isn’t about wanting to go back to the way things used to be, but about the government taking steps to ensure basic public safety,” she wrote.
She noted that Lynn Helms, director of the state’s Department of Mineral Resources, recently predicted that 30 more oil rigs would come on line in North Dakota this winter, joining the more than 200 rigs already operating. The increase would require an additional number of workers close to the combined populations of Divide and Burke counties, she said.
“That may sound exciting to someone sitting in Bismarck, but from my vantage point, it’s a little like telling Minot they better prepare for a bigger flood than the one that already swallowed 4,000 homes last year,” Krimm wrote.
“We cannot take any more,” she wrote.
Ambulance crews, police, water systems, sewage lagoons, roads, stores and restaurants all are at risk of being overwhelmed, she wrote.
“Only an irresponsible state government would allow more people to be added in a region where the health and well-being of every single citizen is already in jeopardy because of inadequate infrastructure and overtaxed emergency services,” she wrote.
A hill to climb
Ron Ness, president of the North Dakota Petroleum Council, said he understands the concerns, but urged people not to “demonize” the oil industry.
“We all know there’s an infrastructure hill here to climb,” he said. “But in North Dakota, we’ve been looking for rural economic development for generations.”
He was returning to his home in Bismarck on Friday after speaking with groups of farmers, community leaders and others in the Oil Patch.
“I feel a lot of positives out there,” he said.
“Oil doesn’t come all nice and neat and without some challenges,” he said. “But if you try to slow the pace, the first thing you’re going to stop is the investment dollar that will bring the roads and the housing and the rest.
“The pace of development is going to have to play out.”
Ness said the infrastructure problems “are all management issues, and we have great resources available to deal with them. There are 2,000 new housing units in Williston, 2,300 in Dickinson, 1,000 in Watford City.” Oil companies, he said, have committed millions of dollars for housing for their workers.
“It’s been a frustrating six to eight months,” he said, but “for the first time, people are starting to see over the horizon a little bit. The North Dakota entrepreneurial spirit is working, and I think 2012 is going to be a great year.”
The Crosby Journal column has been reprinted in at least one other western weekly newspaper and has aroused some blog comment in the region. Journal Publisher Steve Andrist said most of the response Krimm received was positive.
“It was a good, provocative column,” he said. “It raised some issues about our state’s leadership and how active they ought to be in examining what is an appropriate level of development, and then taking steps to try to achieve that level of development.”
Andrist joined the discussion with a column of his own.
“Oil is our lifeblood,” he wrote in the Journal last month. “It also can be our death knell.”
Citing “deterioration of our streets and highways, strain on our social services and law enforcement, crisis in our housing market, and worries about long-term environmental impacts,” he wrote that oil development’s downside is clear.
“But so is the upside,” he said, including record state budget surpluses, new construction and retail sales.
Increasingly, North Dakotans want to strike a better balance, Andrist wrote, and “have publicly and privately articulated strong and logical arguments that slowing development would be a positive step.”
Andrist advocated “an immediate movement to establish a North Dakota energy policy that is in the best interest of the state as a whole.
Such a policy should encompass political, social, business and environmental considerations, which taken together would help determine an appropriate pace of development.”
State leaders and the Legislature “have done reasonably well at reacting to public needs as they become obvious,” he wrote, but they need to look forward. “Unfortunately, the state does not have the luxury of time in establishing a strong public energy policy. Every day that passes, it seems, brings more rigs, more production, more traffic and more people.”
In an interview Friday, Andrist, 57, said he senses “a growing discontent with the pace of development.”
People were reluctant to complain earlier because of lean times preceding the boom.
“When the boom really first started, we had been through three or four or five generations of decline,” he said, “and our local leaders had sat around saying, ‘Gee, if we don’t find a way to turn this around, we’re going to die. We’re going to become the Buffalo Commons.’”
When the boom started, “People said, ‘Hey, this is really good! Something has finally turned us around.’ I don’t know of anyone in these communities up here who thinks we need to put an end to oil development.
“But I am hearing more people say we need to slow down.”
Haga is a reporter for the Grand Forks Herald, which is owned by Forum Communications Co.