North Dakota’s Pipeline Payoff
Six months later, the Dakota Access Pipeline proves its
value.
The Dakota Access Pipeline marks six months of operations on New Year’s Day, and new data show that North Dakota is already enjoying major benefits from the $3.8 billion project.
The pipeline has
significantly lowered energy transportation costs and energy companies to move
their oil to the Gulf Coast, where it fetches a higher price. So it’s little
surprise that energy production has surged since the Dakota Access Pipeline
opened.
Between September and
October alone, oil production grew by 78,000 barrels a day, the biggest
month-over-month increase North Dakota has ever seen. The state peaked at
around 1.185 million barrels a day that month—135,000 barrels more than it
produced daily before the pipeline was operational. Compared with January 2017,
North Dakota has an additional 15 drilling rigs currently in operation.
Increased oil production
has resulted in job growth. North Dakota’s unemployment rate was 2.3% in
November, and more than 850 existing wells need fracking crews. State revenue
rose by about $43.5 million in the first five months the pipeline was
operational. And solely because of the Dakota Access Pipeline, the state is on
track for $210 million to $250 million in additional tax revenue by the end of
this biennial budget period. “That’s exceeded expectations,” says Tax
Commissioner Ryan Rauschenberger.
The Dakota Access Pipeline
has also reduced oil-train traffic within the state. The last time oil
production was this high, North Dakota saw as many as 12 trains, or 1,200 cars,
pass through daily. Today, only two trains do. That’s a victory for the
environment and public safety, given that oil-spill accidents occur with much
greater frequency on railways than in pipelines.
A year ago, North Dakotans
were coping with thousands who flocked to Standing Rock to protest the
pipeline, creating a nuisance and costing taxpayers millions for law
enforcement and cleanup. The new statistics on the Dakota Access Pipeline’s
benefits are recompense for dealing with those unruly out-of-towners.
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