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North Dakota Petroleum Council director on fracking uptick: 'Demand is coming back'

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Kimberly James | The Center Square contributor

(The Center Square) – Fracking is on the rise in North Dakota alongside the demand for oil as the world inches further from the height of the pandemic.

"The pandemic caused a sharp drop in demand and a subsequent drop in prices leading to reduced production," Kristen Hamman, director of regulatory and public affairs at the North Dakota Petroleum Council, told The Center Square. "Now that economies are opening back up, demand is coming back/has come back, but supply has not kept up."

The Russia-Ukraine war continues to add uncertainty to continuing supply problems as Russia is one of the top three oil-producing countries.

"Pre-COVID, the U.S. was the top oil producer in the world," Hamman said. "Domestic production hasn't come back for a number of reasons, including regulatory uncertainty, government leaders announcing plans to move the country away from our products, which has led to difficulty attracting the necessary investment capital to expand and grow production. There are also labor shortages and supply chain backups that are slowing things down."

Hamman said some of the factors that will contribute to increased oil production include getting federal drilling permits and holding federal lease sales, as well as gaining access to capital, building a workforce, and dealing with supply shortages.

"We know the oil is in the ground, and we have the technology, capability and expertise to extract it," Hamman said. "We just need these other things to come together so we can start growing again. We need our elected officials to change their tone and voice their support for growing American energy production."

About 50 percent of state tax revenue comes from the oil-and-gas industry, Hamman said. One in five workers in North Dakota are directly or indirectly employed by the oil-and-gas industry.

Extended-reach horizontal drilling, advanced well completions and hydraulic fracturing have unlocked the Bakken Shale formation and other oil shale resources in the U.S., making North Dakota a top oil producer in the nation.

Ninety-six percent of the oil produced in North Dakota is produced by using the hydraulic fracturing, or fracking, process, Hamman said. The state's highest production level of all time was reached in November 2019 at 1.5 million barrels per day. The latest production numbers from January 2022 were 1.086 million barrels per day.

"The industry has held steady for the last two years, but any growth or expansion we see going forward will be a positive for the state and for consumers," Hamman said.