North Dakota’s Black Gold
For decades on end North Dakota sat on the periphery as one of America’s states that was regarded as a sleeping giant. Primarily it’s vast array of land made North Dakota a great opportunity for farmers to exploit its land for agricultural purposes. But for the last ten years they have managed to have low employment rates and a booming housing economy as a result of the “black gold” they stumbled upon.
The finding of crude oil has changed America’s outlook on energy on such a scale that the economic effects within North Dakota’s borders has created a tsunami. This is not just a short-term boost for the populous of North Dakota, which is the third least densely populated state in America. They will be flush with more money than they know what to do with for a while. According to Continental resources North Dakota is sitting on reserves that dwarf those of the Persian Gulf.
Figures that have been researched and verified suggest within the Bakken formation, which surrounds most of West Dakota, at least twenty five thousand square miles is saturated with oil. The figures vary but a rough estimate illustrates that North Dakota may be sitting on nine hundred billion barrels of oil. The strategic pertinence of such a fact alone will have ramifications on a global scale because it strengthens the American’s hands strategically. No longer will they have to be dependent on Arab states that have a plethora of oil at their disposal. They can stand on their own two feet and reap the benefits.
Also by flooding the market with a new source of oil they will be able to compete with the Arabs instead of being dependent on them. This is good news for local American companies and people who are at the mercy of fluctuating oil prices. This will propel the traders on Wall Street to keep the prices of commodities artificially lower than they presently are now, meaning cheaper groceries for your average middle-class citizen.
Geopolitically speaking, whilst their thirst is quenched, the Chinese and Indians whose desire for oil at the moment is quite insatiable will also feel the ramifications. Cheaper access to oil for American businesses will help kick-start the manufacturing side of the economy which has been dormant for a decade now and in steady decline. It will also give the worldwide economy a much needed boost because American trade picking up opens up more markets for import and export, which has a rippled affect on opportunities for investments. So many people can benefit from this directly, except for those campaigning for green political causes and preservationists, this is certainly to come as a hammer blow to them.
Statistics state that the United States imports just over eight million barrels of crude oil a day, which eats into about fifty per cent of net consumption. Just over twelve per cent of these oil imports come from the Persian Gulf, currently an area of possible conflict with Iran, which is a power in the region. This is why the oil located in North Dakota could open up so many avenues for the United States as a whole and eventually leave the idea of American dependence for energy coming from the Middle East for dead.
In its first year oil sales fetched in excess of $839 million. By the year 2013, these revenues are expected to grow up toward $2 billion. Truckers are fetching between $70-80,000 a year and with some even boasting on Russian State News of double that figure towards $100-160,000. The notion of North Dakota being one of the least densely populated states in America will change as the oil boom attracts more and more capitalists looking to make a quick buck.
EOG Resources Inc, a corporation located in Houston, Texas is just one of the new faces exploiting the exorbitant amounts of oil available. They drilled two wells in 2009 and have been reaping the dividends ever since. They are just one of a few companies worth looking out for in regards to investment as their portfolio continues to expand.
In conclusion investors still feeling the doom and gloom of this recession can seek solace in the fact that avenues still remain on the commodities market, which are worth pursuing. Many have been bereft of the notion of investing in North Dakota’s oil mainly because they are unaware and of course tightening the purse strings, as many tend to do in restricting economic times. But the boom occurring in North Dakota may just be worth analysing and possibly investing in.