North Dakota’s Oil Resources

by Charles T. Edin

In my Bismarck, North Dakota law practice I undertake numerous legal matters relating to oil and gas matters, including preparation and analysis of mineral and royalty deeds, oil and gas leases, surface owner protection agreements. Also, I am extensively involved in oil and gas title matters, includinging preparation of oil and gas title memos, drilling title opinions, and division-order title opinions throughout the North Dakota segment of the Williston Basin. In the area of administrative law, I appear on behalf of clients, including both land owners and oil companies, before the Oil and Gas Division of the North Dakota Industrial Commssion which regulates oil and gas development in North Dakota, including environmental concerns and pooling and spacing matters.

The Williston Basin is centered in Williston, North Dakota, and extends into Eastern Montana and Southern Saskatchewan. The basin has formed above an ancient Precambrian geologic basement feature, the Trans-Hudson Orogenic Belt, which is relatively weak. This caused geologic sagging and led to the eventual formation of basin geography. Over millions of years, from the Cambrian Period on, numerous sediments were deposited, including limestone, dolomite, sandstones, siltstones, and shales. These deposits provided both the reservoir rocks and sources of hydrocarbons necessary to form coal and oil deposits. Tectonic activity during the Cretaceous Period, the peak of the dinosaurs, rejuvenated some of the basement structures in the Williston Basin, resulting in anticlines that function as oil traps.

Interest in North Dakota’s oil resources has been increasing steadily over recent years. In a July 2010 report, the North Dakota Geological Survey and Department of Mineral Resources concluded that there may be some 2 billion barrels of recoverable oil in the Three Forks Formation, in addition to the already established 2 billion barrels in the Bakken Formation. There is considerable oil production in the North Dakota and Montana parts of the Williston Basin, with daily production of over 200,000 barrels of oil a day. Much of the oil currently produced in southern North Dakota and Montana is shipped via pipeline to a Guernsey, Wyoming, hub, and from there, it is shipped to refineries in Colorado, Utah, Wyoming, and Illinois. Northern North Dakota and Montana crude oil is piped to a Clearbrook, Minnesota hub. In addition, the Tesoro Corporation refinery in Mandan, North Dakota offers a maximum capacity of 60,000 barrels per day. This is an exciting time to be involved in the energy industry in North Dakota, and I am encouraged by the employment opportunities that this booming industry has brought to Bismarck, Mandan, and the surrounding areas.