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Tillman: Success and challenges in North Dakota

The extraordinary growth we’ve seen in our nation’s oil and gas industry in the past few years — driven in large part by the success of the Bakken here in North Dakota — is nothing short of historic.

But our ability to continue to grow — our ability to continue to shape America’s and the world’s energy future — depends on two things: capitalizing on opportunities and navigating the challenges.

Marathon Oil is very proud to be part of the Bakken success story. More than 60 percent of our $5.9 billion capital, investment and exploration budget this year is going toward investments in our three high-quality U.S. resource plays, including over $1 billion in the Bakken.

Accessing these resources is critical to America’s economic growth and energy security. It also will have a profound effect on global markets, and growth and security around the world. U.S. energy production has become an asset for our country and a stabilizing geopolitical influence.

However, if we’re going to deliver on the promise of these vast resources, we must recognize, embrace and commit ourselves to developing solutions for the many challenges we face. We must engage openly, honestly and with a sense of urgency with those who are voicing concerns, and demonstrate our ongoing commitment to safe and responsible operations.

But perhaps most important: We must talk about what we’re doing in a meaningful, credible way — to our friends and supporters, but also to our skeptics and opponents.

For example, we’re very conscious of our water use in oil and gas operations, including its impact on supplies. In the Bakken, where produced water has a high salinity that makes recycling difficult and requires large amounts of fresh water for dilution, Marathon Oil is evaluating the use of gels to make recycling possible. We’re also exploring a second option that uses a proprietary treatment process that results in clean, reusable brine for drilling as well as fresh water for hydraulic fracturing. Field piloting for both of these conservation methods is planned for this year.

As an industry, we recognize the global concern related to the potential impact of greenhouse gases and other air emissions on the environment. I applaud the North Dakota Petroleum Council for their work to create a flaring task force — a group spearheading the industry’s efforts to significantly reduce natural gas flaring in the Bakken.

Looking ahead, the 2015 legislative session will be critical and we’re eager to work with the state’s elected leaders in Bismarck. We need the support of the Legislature for critical infrastructure projects. State funding to provide western North Dakota counties with the hospitals, law enforcement and schools they need is vital.

North Dakota is well aware of the critical need to employ strict safety measures that help avoid rail accidents, and to mitigate the impact should one occur. The U.S. Department of Transportation, through the Pipeline and Hazardous Materials Safety Administration and the Federal Railroad Administration, is taking a renewed focus on the safe transportation of bulk hazardous materials. We support their objectives and remain committed to partnering with all reasonable entities that are solution-driven and that share our commitment to safely and responsibly developing America’s energy resources.

As an industry, we must be respectful of the communities in which we operate. We must be responsible corporate neighbors and never lose sight of the fact that we’re guests in these communities and that we’ll be judged by our individual and collective behaviors.

There is no doubt that North Dakota is in the midst of an unprecedented transformation that has proven valuable to the state and its citizens in many ways.

At a time when other parts of the country are trying to attract jobs, generate tax revenue and secure large capital investments, North Dakota stands out as a model that others aspire to emulate. With this success, there is a confidence, an optimism, an evolving sense of progress — and pride — that will enable North Dakotans to build a future for themselves and their families — a future replete with compelling opportunities right here at home.

Tillman is the President and CEO of Marathon Oil Corp. He was the Wednesday keynote speaker at the Williston Basin Petroleum Conference in Bismarck.