June 2013 The Bakken Magazine

JUNE 2013

Reason toBoast

Why Engineers Deserve Attention in Oil and Gas Country Page 18

Plus:

The Business of Safety Page 26

AND:

Legislation That Matters Page 8

Buzz from the Williston Basin Petroleum Conference Page 14

www.THEBAKKEN.com Printed in USA

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Contents

JUNE 2013

VOLUME 1 ISSUE 3

DEPARTMENTS

Making It

24 Growing the Bakken Village Out of Prairie

Forget about new workforce housing outside of town, a development team from South Dakota is working to build a city from scratch, and they have the experience to do it.

By Chris Hanson

In PlAY

26 Spotlight on Safety

Safety providers have learned the intricacies of managing and creating a better workplace environment.

By Staff

RESEARCH

28 Canada’s Bakken Rock Stars

The Saskatchewan Ministry of the Economy oil and gas research team has proven why it is the provincial expert on the Bakken formation.

By Staff

4 Editor’s Note

Production, Passion and Pride

By LUKE GEIVER

CONSTRUCTION AND INFRASTRUCTURE

Engineering Attention

Oil production gets the attention, but the services provided by engineering firms deserve to be recognized.

8 N.D. Petroleum Council

Legislative Progress Breakdown

By Alexis Brinkman

10 Bakken News

Bakken News & Trends

14 Conference Review

Williston Basin Petroleum Conference 2013

By Staff

By LUKE GEIVER

Pg 18 JUNE 2013

Reason toBoast

Why Engineers Deserve Attention in Oil and Gas Country Page 18

Plus:

The Business of Safety Page 26

AND:

Legislation That Matters Page 8

Buzz from the Williston Basin Petroleum Conference

ON THE COVER: Jame Todd, principal engineer for Bartlett & West's energy division has helped lead a pipeline project and develop a Geographical Systems Information map.

Page 14

www.THEBAKKEN.com Printed in USA

PHOTO: JACK GLASSER

THEBakken.com

5

EDITOR'S NOTE

Production, Passion and Pride Luke Geiver

Editor The Bakken magazine lgeiver@bbiinternational.com

When was the last time a complete stranger started crying in front of you within the first five minutes of conversation? For me,

it was a few weeks ago at the 21st Annual Williston Basin Petroleum Conference. I was standing at a booth, recorder in hand, listening to a product development team explain the merits of their technology. A polished piece of equipment was on display in the booth for interested parties to touch. The aisle behind me was crowded with passing attendees, and as the conversation progressed, the person speaking about the product began shifting his glance from me to the equipment and then back to me, again and again. Eventually, his eyes stopped on the equipment piece, he raised his hand to touch its shiny exterior, he paused, and two small tears leaked down his cheeks.

I didn’t say a word, but kept recording. After a swipe across his cheeks with his shirt sleeve, he smiled, looked up at us, and started talking again. Thankfully, for my colleague and me, he assured us that it wasn’t us. His brief bout of emotion was, instead, linked to the time, effort and personal experience he had invested in designing and implementing the product into the Bakken play. Talking about the history of the product reminded him of that. Believe it or not, that wasn’t the only conversation I had during the event in which a company owner broke down.

The takeaway from those conversations may be one of many things, but I would argue it is as simple as this: a lot goes into the Bakken. It’s not just about production; it’s about passion and pride, and because of that, development of the region will successfully continue for the long-term in all areas, from production to well site prep to housing construction.

For the June issue, we highlighted several companies that have put a lot into the play and are reaping the economic and career achievement benefits created by executing in the Bakken. Jame Todd, a principal engineer for a Bismarck-based engineering firm is a perfect example. Although Todd never shed any tears in front of me during our face-to-face talk about his efforts to streamline the crude oil pipeline construction process, he did explain the approach his team has successfully used to staff, house and more importantly, adapt to the needs of the energy industry and its time-sensitive demands. As Todd says, “With energy companies, today everything is yesterday.”

The fast pace and demand by the energy industry for services aren't only seen in the engineering sector. And the engineers in the play aren’t the only service providers adapting and thriving.

Fairlight Medical Center of Williston, N.D., has found a way to manage a growing business while supplying services to a market the medical staff might never be able to keep up with. A South Dakota-based development group is doing its part to meet the housing demands as well. The team intends to build a city, complete with everything a small city might have, on the site of a prairie field. The best part is, the team has already done it elsewhere. Chances are, most of us have never built a city, but I would imagine a lot goes into it, a lot to be proud of.

6

The Bakken magazine June 2013

ADVERTISER INDEX

www.THEBAKKEN.com VOLUME 1 ISSUE 3 EDITORIAL Editor Luke Geiver lgeiver@bbiinternational.com Senior Editor Susanne Retka Schill sretkaschill@bbiinternational.com Staff Writer Chris Hanson chanson@bbiinternational.com Copy Editor Jan Tellmann jtellmann@bbiinternational.com

PUBLISHING & SALES

21

Bakken Oil Workers & Oil Service Expo

25

Bartlett & West

30

Cameron

3

Carroll's Asphalt Paving

2

MBI Energy Services

23

Polymer Services, LLC

Chairman Mike Bryan mbryan@bbiinternational.com

31

Quality Mat Company

CEO Joe Bryan jbryan@bbiinternational.com

32

Targeted Job Fairs

President Tom Bryan tbryan@bbiinternational.com

4 16

Vice President, Sales & Marketing Matthew Spoor mspoor@bbiinternational.com

The Bakken Magazine Ulteig Engineers

Vice President of Content Tim Portz tportz@bbiinternational.com Business Development Manager Bob Brown bbrown@bbiinternational.com Circulation Manager Jessica Beaudry jbeaudry@bbiinternational.com Senior Marketing Manager John Nelson jnelson@bbiinternational.com Advertising Coordinator Marla DeFoe mdefoe@bbiinternational.com

ART Art Director Jaci Satterlund jsatterlund@bbiinternational.com Graphic Designer Lindsey Noble lnoble@bbiinternational.com

Subscriptions Subscriptions to The Bakken magazine are free of charge to everyone with the exception of a shipping and handling charge of $49.95 for any country outside the United States, Canada and Mexico. To subscribe, visit www. thebakken.com or you can send your mailing address and payment (checks made out to BBI International) to: The Bakken magazine/Subscriptions, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203. You can also fax a subscription form to 701-746-5367. Reprints and Back Issues Select back issues are available for $3.95 each, plus shipping. Article reprints are also available for a fee. For more information, contact us at 866-746-8385 or service@bbiinternational.com. Advertising The Bakken magazine provides a specific topic delivered to a highly targeted audience. We are committed to editorial excellence and high-quality print production. To find out more about The Bakken magazine advertising opportunities, please contact us at 866-746-8385 or service@bbiinternational.com. Letters to the Editor We welcome letters to the editor. If you write us, please include your name, address and phone number. Letters may be edited for clarity and/or space. Send to The Bakken magazine/Letters, 308 Second Ave. N., Suite 304, Grand Forks, ND 58203 or email to lgeiver@ bbiinternational.com.

TM

COPYRIGHT Š 2013

by BBI International

Please recycle this magazine and remove inserts or samples before recycling

THEBakken.com

7

THE MESSAGE North Dakota Petroleum CounciL SASKATCHEWAN Williston $52.4 M

Bakken Formation Dickinson $26.4 M MONTANA

MANITOBA Minot $7.6 M

NORTH DAKOTA 94

Williston Basin

Total of

$1.143 billion

to oil-impacted cities, counties, townships, roads & highways

Taxes

SOUTH DAKOTA

Legislative Progress Breakdown

by Alexis Brinkman Images by The Bakken magazine staff

The 63rd Legislative Assembly of North Dakota will go down in history as the state’s longest legislative session. Legislation covering every aspect of the oil and gas industry was discussed throughout the course of the session and work continued for the North Dakota Petroleum Council all the way to day 80.

Following is a breakdown of the results in some of our top issues:

Oil Impacts Increasing funding for oil-impacted cities, counties and townships was one of the most important issues of the session and from the beginning, the bill proposed by Rep. Robert 8

Skarphol was the vehicle to get it done. At the end of the day, HB 1358 included $1.143 billion for fixing roads, building infrastructure, providing law enforcement and emergency medical services and more. This was one of NDPC’s biggest issues this session, as ensuring the needs of our impacted communities are met is very important to our industry. The additional funding for western North Dakota provided in this bill is only the beginning of what’s needed to build up the necessary infrastructure, but it is a great step in the right direction.

NDPC also worked in support of additional staffing for various state agencies, including 15 new highway

The Bakken magazine June 2013

who are hesitant to grant easements across their property.

It includes an expanded mediation program and an abandoned well fund. Among other legislation addressing surface rights is a bill that allows flares, tanks and treaters to be placed at a greater distance from occupied dwellings at the request of the landowner for wells located within 1,000 feet of that dwelling.

patrolmen for western North Dakota, nine new Department of Health staff members to deal with oil-related issues, and 22 new positions at the N.D. Industrial Commission to help meet the increasing demand in oil-impacted areas.

Landowner and Surface Rights A multitude of legislative measures addressing various landowner and surface rights issues were passed. Prior to the session, we spent time working with the Dunn County Landowner’s Association to put together HB 1333. This bill includes many tools to address concerns from landowners who have multiple easements crossing their land and others

Oil and gas development has brought about tremendous changes on the Fort Berthold Indian Reservation. The tribal tax agreement was one of

Bills Bringing Change: Taxes (HB 1198)

-Reduced tax rate of 2 percent for wells drilled 10 miles or more outside of non-Bakken and Three Forks fields for first 75,000 barrels produced.

-All stripper-well properties now eliminated. New wells completed after July 1, must qualify for stripper status individually.

-Stripper-well threshold increased to 35 bopd.

-Splits production and extraction tax collections on trust lands 50/50 between Three Affiliated Tribes and N.D. -Splits production and extraction tax collections on fee lands 50/50 between TAT and N.D. -Five-year tax holiday for new wells on fee lands eliminated after July.

-Annual report on infrastructure expenditures, fees and costs imposed on oil and gas industry required by TAT. -10 percent must be spent on infrastructure.

-(Formal agreement still in development between Gov. Jack Dalrymple and TAT).

THE MESSAGE

Funding Highlights the most important issues of the session for NDPC. After countless meetings with industry, legislative leadership and the tribal council and multiple attempts to pass an agreement, a deal was made during the final afternoon of the session. That agreement was put into HB 1198, which will split production and extraction tax collections 50/50 between the Three Affiliated Tribes and the state.

Needs for increased funding within the reservation are the same as those across the oil patch, and the new agreement will provide the funds necessary for the Three Affiliated Tribes, the Mandan, Hidatsa and Arikara Nation, to meet the growing demand for infrastructure, housing and social services. HB 1198 also made some major changes to the oil and gas tax structure, including: •Requires the oil operator to withhold income taxes from nonresident royalty owners after Dec. 31. This requirement applies only to producers with production exceeding 350,000 barrels per year.

•Provides a non-Bakken/ Three Forks new-well incentive. This incentive subjects the first 75,000 barrels produced during the first 18 months from the time a well has been drilled and completed to a reduced tax rate of 2 percent. The well must be outside of the Bakken/Three

Water (SB 2233)

-Transfers responsibility for all existing Western Area Water Supply Authority debt to state.

$7 million EMS services

Oil and Gas Impact fund increased to

$240 million

-Requires WAWSA to receive approval from State Water Commission.

-Fine for water appropriation violation increased from $5,000 to $25,000 per day.

Pipelines:

-Penalty for pipeline safety standards increased from $10,000 to $200,000.

Industrial Commission will hire new staff

$4 million

Higher education grants

23

-Increased penalty for failure to call before digging.

$3.5 Million

Department of Mineral Resources hiring

Department of Heath will hire

9 new staff

-Permit requirements for pipelines sited in previously permited areas or corridors lessened.

-Underground gathering pipelines must include location files available to landowners.

Sheriff departments

22

-Prohibits WAWSA from preventing others from developing state’s water resources.

-Allows WAWSA and independent water providers to construct lateral pipelines to connect to oil and gas industry.

$7 million

Fire protection districts Counties with new oil impact

$5 million

DOT

to hire 16 new staff

$4 million

Dust control pilot project

Airport grants

15

Highway patrol will hire new patrolmen

$60 million

$14 million Hub cities

Flaring (HB 1134)

-Allows gas collection for compression to liquid for valueadded products.

-Tax exempts collected gas for first two years after production.

(HG 1410)

-Exempts materials used in liquefying gas from sales and use tax.

-Exempts fuel used by BNSF for LNG construction facility from use tax.

Failed Bills

-Required tax and royalty payments after one year following initial production if flaring occurs.

-Property tax exemption for new natural gas gathering and collection systems.

-N.D. Pipeline Authority’s ability to lend for refineries.

-Major changes to oil and gas taxation.

-Tax on industrial water use.

-Additional $50 million for more Hub Cities, including Watford City, N.D..

Forks formations and 10 miles or more outside an established field.

• Eliminates all stripperwell properties and requires every new well completed after July 1, 2013, to qualify for stripper status individually.

• Raises the stripper-well threshold on Bakken/Three Forks to 35 barrels of oil per day from 30.

• Extends the $55 onemonth triggered incentive on horizontal wells for two years.

Many, many other issues were addressed throughout the

course of the session, from flaring and pipelines to water, trucking and workforce issues.

All in all, it was a long and difficult session, but in the end the oil and gas industry fared very well, and great progress was made in addressing the impacts and challenges faced in western North Dakota.

Author: Alexis Brinkman North Dakota Petroleum Council 701-223-6380 abrinkman@ndoil.org

THEBakken.com

9

(3) middle member, and (4) upper shale member. The sandstones and siltstones 7.4 billion barrels of oil, 6.7 trillion cubic feet f the Bakken of associated/dissolved natural gas, and Formation and are limited in extent. The maximum thickness of the Pronghorn is 0.53 billion barrels of natural gas liquids in 58 feet (LeFever and others, 2011). The upper and lower shale members are the the Bakken and Three Forks Formations in primary source rocks for the Bakken TPS, with present-day total organic carbon the Williston Basin Province of Montana, (TOC) values from weight percent to 35 weight percent (Lillis, 2013). The shale BAKKEN NEWS & <1 TRENDS North Dakota, and South Dakota. members are present in parts of Montana and North Dakota and extend into the Canadian provinces of Saskatchewan and Manitoba, though the Canadian provinces Introduction were not assessed. The lower shale member reaches a maximum thickness of 56 feet The U.S. Geological Survey (USGS) recently completed a geology-based assessment of 108° 107° 106° 105° 104° 103° 102° 101° 100° 99° 98° 97° conventional and continuous oil and gas resources of the Devonian Three Forks Formation and 49° CANADA Devonian and Mississippian Bakken Formation Poplar in the Williston Basin Province of North Dakota, dome

BAKKEN NEWS Twice as Big

7.4 3.6

2008 10

2013

The Bakken magazine June 2013

2018

Nesson anticline

T UL FA OID R F ON KT OC BR

48°

47°

MONTANA

ek Cre ar line Ced antic

The U.S. Geological Survey’s 2008 assessment of the Bakken Formation's recoverable oil potential2008 hasUSGS become one of theBakken most Formation downassessment of the (Pollastro and others, 2008), than 4,000 loaded publications ever issued by the USGS. That maymore soon change. additional wells have been drilled, providing sigIn 2008, the USGS estimated the Bakken Formation held roughly Forks with Formations.

Furthermore, Three Forks 3.65 billion barrels of oil. Equipped new geologic andtheproducFormation was not assessed in 2008 by the USGS tion information not available five years ago, the USGS has reissued and accordingly warranted assessment based on its assessment of the Bakken (and added the Three Forks Formation) this formation. being from the for 2013. The new estimates, 7.4inbillion barrelsOilofis oil in produced the combined Bakken and Three Forks Formations using both formations, are unmatched, andhorizontal double what were in 2008.

“This drillingthey technology, which exposes a is the largest unconventional oillarger resource that the USGS ever asamount of reservoir to thehas wellbore than vertical wells, andprogram hydraulic fracturing, which sessed,” said Brenda Pierce, energy resources coordinator. stimulates movement of hydrocarbons in tight-oil The assessment provides areservoirs. mean undiscovered estimation Approximatelyvolume 450 million barrels of oil (MMBO) have been produced from for both the Three Forks and Bakken formations. For oil, the mean the Bakken and Three Forks Formations in the average is 7.4 billion barrels of oil, 6.7 trillion cubic feet of associated United States since the 2008 assessment of the gas created during oil extractionBakken and 0.53 billion barrels of natural Formation. gas liquids. The 7.4 billion barrels of oil number is the average of a Geologic Summary of the Bakken high and low estimate created byand theThree USGS, which estimates the two Forks Formations formations may contain 4.4 billion barrels to 11.4 billion barrels of The Bakken Total Petroleum System (TPS) undiscovered, technically recoverable oil. “However, there is no Three way to encompasses strata from the Devonian Forks Formation, Bakken Formation, and lower know how much oil is in the Bakken Formation or any formation until part of the Mississippian Lodgepole Formation the area is actually drilled and produced,” according to the USGS. that may contain Bakken-sourced oil. The TPS The 2013 assessment is similar to the previous version, said U.S. Departmentteam of the Interior Stephanie Gaswirth, Bakken assessment lead, except for one U.S. Geological Survey difference. “The difference this time is that there is a substantial amount of new geologic information,” she said. Since 2008, roughly 4,000 wells have been drilled, giving the USGS a large volume of new information.

“We assess basins all the time,” said Pierce, “but the timing of reassessment depends on the availability of new data. The Bakken has gone through a revolution with new technological applications.”

Because of the technological advances, the assessment team realized new data was available, Pierce said.

46°

Antelope anticline Little Knife anticline

NORTH DAKOTA

Billings Nose anticline

45°

44°

SOUTH DAKOTA

WYOMING

CANADA MT WY

0

50 MILES

0

50 KILOMETERS

ND SD

EXPLANATION Middle Bakken Conventional AU

Eastern Transitional Continuous Oil AU

Elm Coulee-Billings Nose Continuous Oil AU

Northwest Transitional Continuous Oil AU

Central Basin Continuous Oil AU

Williston Basin Province boundary

Nesson-Little Knife Continuous Oil AU

Bakken TPS

Figure 1. Map showing the Williston Basin Province, Bakken Total Petroleum System (TPS), the Bakken Formation Units (AUs).

Major structural are Map and showing the Williston BasinAssessment Province, Bakken Total Petroleum Systemfeatures (TPS), and also map shows location of the Bakken TPS (pink). features are also shown. theshown.

BakkenInset Formation Assessment Units (AUs).

Major structural

Inset map shows location of the Bakken TPS (pink).

Printed on recycled paper

Fact Sheet 2013–3013 April 2013

In addition to a new assessment of the Bakken, the team added the Three Forks, something it didn’t do in 2008. “The Three Forks was generally considered nonproductive, there was no production data during the last assessment,” said Galwirth. Credit the North Dakota Geological Survey, the North Dakota Industrial Commission, the Montana Board of Oil and Gas and several other industry groups or producers for the new supply of information, according to the USGS. The USGS has not issued an official estimation on the time period it will take to recover the oil resources, but judges “it is likely to be many decades.”

The long-term prominence of the play has one decision maker in North Dakota committed to the development of the infrastructure needed to transport the resource from the well site to refineries across the U.S. “This assessment is yet another reminder that increased oil and gas development in North America requires critical infrastructure, like the Keystone XL pipeline,” said U.S. Sen. Heidi Hietkamp, D-N.D., adding that among many issues, “we need to ensure that there are adequate roads, housing units and schools in the Bakken communities to support long-term growth.”

BAKKEN NEWS

Moving to New Markets The movement of Bakken-crude out of the region is beginning to happen in a big way.

Two major oil refining firms, Tesoro Corp. and Phillips 66 have signed agreements to ship Bakken crude to refineries on the east and west coasts. And, PBF Energy Inc., an independent refiner operating on the East Coast, has signed with Continental Resources Inc. to move a portion of CRI’s crude to a Delaware refinery.

Dennis Nuss, spokesperson for Phillips 66, says the company plans to use Bakken crude in its Bayway, N.J., refinery and in its Ferndale, Wash., refinery. And, Nuss refers to Bakken crude as advantaged crude, or oil that sells at a discount to the global benchmark, North Sea Brent crude. For Phillips 66, the main challenges of working with Bakken producers is the long supply chain between N.D. and coastal refineries, a situation that makes scheduling and tracking railcars difficult. But,

Power Demands By 2017, electricity demand in North Dakota will increase by 88 percent, according to the N.D. Industrial Commission, in each electricity category: industrial, commercial and residential. The enormous jump in power usage stems from oil and gas production and the need for power in the industrial sector, including the addition of new wells, building and operating the infrastructure necessary to support production of pipelines, water treatment facilities, gas processing plants and refineries. In 2012, the U.S. Energy Information Administration reported that sales of electricity in both the commercial and industrial sector accounted for 35 percent of total sales, with the remaining 30 percent used by residential customers.

The rise in industrial electricity has, however, created an increase in both the commercial and residential categories.

Basin Electric Power Cooperative has already applied for a new transmission line with the N.D. Public Service Commission. The 345-kilovolt line would stretch for 200 miles from the company’s Antelope Valley Station near Beulah, N.D., to substations in the N.D. communities of Grassy Butte, Williston and

he says, “We are confident we can overcome this challenge.”

So are other companies. Tesoro Corp. and Savage Companies, have formed a joint venture to bring Bakken crude to the Port NECESSARY PURCHASE: Phillips 66 recently purchased these rail cars to move of Vancouver where Bakken-crude to the west and east coasts. product will end up at PHOTO: PHILLIPS 66 PBF also has a lot to look forward to. a new 120,000-barrelper-day crude rail-unloading and marine-load- Through its agreement with CRI, the company will use its double-loop track to receive Bakken ing facility. Savage will design, construct and operate the facility, which could be operational crude. Tom Nimbley, PBF CEO, said of the agreement, the company has made significant in 2014. Tesoro is already planning an expaninvestments in acquiring rail cars and developsion to 280,000 bpd. The Port of Vancouver ing its East Coast rail delivery infrastructure, team looks forward to diversifying its cargo handling capabilities, according to Todd Cole- which “positions PBF to benefit from these cost-advantaged crudes.” man, CEO. North Dakota electricity sales by sector, rolling 12-month average January 2007-February 2013 indexed to January 2007 1.6 1.4 1.2 1.0 0.8 0.6 0.4 0.2 0.0 Jan-07

Jan-08

Jan-09

Jan-10

Industrial

Jan-11

Jan-12

Commercial

Jan-13

Residential

SOURCE: U.S. Energy Information Administration, Electric Power Monthly.

NOTE: Rolling 12-month averages are the average of the preceding 12 months of data, to adjust for seasonality in the volume of electricity sales.

Tioga. The company says the state’s current system is reaching its limits.

A 2012 study by Bismarck-based Kadrmas, Lee & Jackson Inc. titled, “Williston Basin Oil and Gas Related Electrical Load Growth Forecast,” revealed the power needs of the oil and gas industry. Monthly meter data of oilfield-related electric loads showed an average usage of 22 kW per oilfield site, the report said. Most well sites are run by onsite

generators during drilling and completion phases, but during long-term production, each site is connected to an electrical grid.

The increase in electricity demand doesn’t just highlight what the state needs. According to the U.S. EIA, between 2007 and 2011, the increase in electricity coincided with a 41 percent increase in the state’s gross domestic product.

THEBakken.com

11

BAKKEN NEWS

FIRST OF MANY: As oil production continues, so does the need for gas transport lines and processing centers like the ONEOK Stateline I facility in Williams County, N.D..

PHOTO: ONEOK

The Name to Know in Natural Gas There is a new household name associated with the reduction of natural gas flaring in the Bakken: ONEOK. The Tulsa, Okla.-based natural gas processing and transportation company, has not only invested heavily in the play, it has completed three major projects to move or process associated gas produced during oil or gas retrieval. With more than 5,000 miles of natural gas gathering infrastructure and overall acreage dedications in the region of roughly 3.1 million acres, ONEOK Partners LP is the largest independent operator in the Williston Basin.

The company recently completed the Bakken NGL Pipeline, a 600-mile pipeline with the capacity to move 60,000 barrels per day of unfractionated natural gas liquids from ONEOK’s facilities and third-party facilities.

The pipeline cost roughly $550 million and NGL’s transported from the Williston Basin eventually arrive at the company’s NGL 12

fractionation and storage facility in central Kansas. The pipeline is the first NGL-capable transport infrastructure to move product to the Mid-Continent and the Texas Gulf Coast. By third quarter 2014, a $100 million investment announced in 2012 will increase the capacity of the pipeline from 60,000 to 135,000 bpd. According to the North Dakota Pipeline Authority, the state produced roughly 850 million cubic feet per day (MMcf/d) of associated gas for the month of February.

In western Williams County, the company has also started operating Stateline II, a 100 MMcf/d processing facility, the third of its kind to be completed

by ONEOK in the Williston Basin since 2011. The company now has processing capacity of 390 MMcf/d.

“The completion of Stateline II, along with our other two

The Bakken magazine June 2013

plants and associated infrastructure that are operational, will reduce the flaring of natural gas in the region,” according to Terry Spencer, president of ONEOK

Partners. By 2015, the company will have invested between $1.7 billion to $1.9 billion in the Williston Basin.

Bakken Pipeline

Montana

North Dakota

South Dakota Wyoming

Nebraska Utah Colorado

Bakken Pipeline

Overland Pass Pipeline

Kansas

NGL Factionator

BAKKEN NEWS

Opportunity Epitomized Northern Plains Nitrogen, a startup fertilizer production company, epitomizes why challenges in the Bakken are often opportunities in disguise. The company, created by farmers in the Northern Plains region with a little help from North Dakota State University, has announced it will build a nitrogen fertilizer production plant using natural gas sourced from western North Dakota as the main feedstock for its fertilizer. The facility, which could come online in 2017, will be built northwest of Grand Forks, N.D., near an existing wastewater treatment facility. In total, the plant will cost roughly $1.5 billion.

Gov. Jack Dalrymple called the plans an exciting opportunity for the city, the state and the company, noting that the increasing supplies of natural gas can provide the plant with feedstock and help regional farmers re-

duce their consumption of product typically sourced from places such as Eygpt, China or Saudi Arabia. Don Pottinger, NPN CEO, said the facility will be “among the safest, most efficient and environmentally compliant ever constructed.”

The company is currently working on the engineering, design and infrastructure need assessment of the facility. If completed, the plant would have a 2,200 ton-per-day nitrogen fertilizer production capacity, or roughly 600,000 tons of nitrogen per year.

At the peak of construction, the plant could employ more than 2,000, and during operations, NPN believes the plant would employ 135 full-time workers.

North Dakota currently ranks as the No. 12 producer of ammonia fertilizer in the U.S. at 400,000 tons per year. According to a

Baseline Assumptions Used in Estimating Ammonia Cost Natural Gas Cost ($/MMBtu) Plant Efficiency Rate (%) Electricity Cost ($/kWh) Electricity Requirement for Small Plant (kWh/ton) Electricity Requirement for Large Plant (kWh/ton) O&M Cost for Small Plant ($/ton) O&M Cost for Large Plant ($/ton) Natural Gas Requirement (MMBtu/ton) Real Discount Rate (i) (%) Lifetime Financing (n) (years) Number of Operating Days

5 100 0.06 950 100 40 30 33 8 20 340

IMAGE: NORTHERN PLAINS NITROGEN

study conducted by NPN and NDSU on the feasibility of using natural gas sourced from western N.D. to produce fertilizer, the cost of natural gas accounts for roughly 50 percent of the production costs.

Canada’s Love/Hate with Shale Unconventional oil or gas produced from shale formations like the Bakken, are helping and hindering Canada’s economy. Oil production in the Saskatchewan portion of the Bakken will create roughly 7,000 new jobs in Regina by 2016, according to a report by the Bank of Montreal. Because of investment by local businesses and new operations to purchase new equipment, expand or hire,

John MacAulay, senior vice president of BMO, says, “The best is yet to come,” for the southern Saskatchewan cities of Regina and Saskatoon. The 170,000 barrels of oil produced per day in the region is also helping to increase construction activity. According to the report, the value of nonresidential permits in the two cities was $836 million in the 12-month period through January, near the highest on record.

A report issued China's Oil Imports Poised to Surpass US (L); Asia from CIBC World Has Accounted for Two-thirds of New Demand (R) Markets Inc., paints a different picture net imports, mn bbl/day % of Total Growth in 80 16 World Oil Demand, of the impact 2002-12 70 14 of shale-based oil on the Cana60 12 dian economy and 50 10 energy industry.

40 8 Avery Shenfeld, chief economist for 30 6 CIBC, said growth 20 4 in U.S. shale output China 10 2 has put America’s United States net import require0 0 Asia Middle Rest of Jan- Jan- Jan- Jan- Janments on a collision East World 04 06 08 10 12 course with Cana-

dian plans to ramp up its output of oil. More production in the U.S. is coming at a time when Canada hopes to export more product into the U.S. Product from plays like the Bakken is also putting a strain on infrastructure typically used for Canadian-based crude. Because of that, Shenfeld says it is increasingly important that Canada move on one or more of the alternative pipelines that would help transport Canadian-based crude to Asia. And the rising prowess of China as the world’s No. 1 importer of crude helps to illustrate this.

According to the CIBC report, China will overtake the U.S. this year as the world’s largest net importer of oil.

In addition to it’s ability to shift part of its crude supply focus to China, Shenfeld also says building and leveraging the use of the Keystone XL pipeline will help attract investment to the country. “Three key trends—rising shale oil prospects stateside, the shift in consumption growth to Asia, and a growing list of oil producing countries open to foreign participation—all pose challenges if Canada is to maximize the value of its resource base,” he says.

Source: NBS, DOE, CIBC

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Conference review

MAT MODEL: To provide a visual representation of its products, Quality Mat had a model made for the show.

MORE THAN A TRAILER: General Irrigation & Dewatering, an Oakes, N.D.-based company, displayed its customized genset and pumping trailer.

SHINY AND CLEAN: Polished equipment was showcased in the parking lot exhibit area.

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The Bakken magazine June 2013

FIRE SAFETY: The flameless heater treater system can help to separate oil from water while increasing well site safety.

conference review

BIG TALK: The 2013 event brought together researchers, businesses, and the general public for discussions on the basics and the need-to-knows.

Williston Basin Petroleum Conference 2013 Highlights from the event of the year

By The Bakken magazine staff Photos by Luke Geiver

Parking spots near the entrance of Evraz Place, the site for the 2013 Williston Basin Petroleum Conference in Regina, Saskatchewan, were all taken during the event, held April 30 through May 2. Occupying the premium spaces were drilling rig equipment, flameless heaters and demonstrations of a handful of other sparkling-clean devices. In its 21st year, the WBPC also showcased impressive equipment and 300-plus vendors in the exhibit hall and provided expert perspective on the intricacies of the geological formations within the Williston Basin through numerous speaker presentations, updates from the playâ&#x20AC;&#x2122;s leading voices and incentive to attend the 22nd version of the event.

A SECOND LOOK: Pumping systems and similar equipment were on display at the show.

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conference review

The Setting

THE SECRET TO STORAGE: Based on industry request, General Watering & Irrigation created a valve storage system that helps reduce wear and tear to pump valves. The system uses lockable bars to hold the valves in place during travel.

The combination of high-end appetizers, an open bar and casually dressed industry representatives made the opening night event in the exhibit hall a difficult place to hold a quiet conversation. Registration lines for the first hour stretched past the hall entrance, with 30-plus attendees in five or more lines. A handful of next-day speakers visited in the VIP lounge, and a jazz band strolled the exhibit floor, providing background music for company representatives.

Innovation was in evidence everywhere, seen in every aisle.

Videos of innovative new drill bit technology played, accompanied by a physical display of the bit that the viewer could touch while seeing it in action. Attendees could stand within inches of a massive oil storage tank equipped with the latest monitoring technology. Vendors showcased products ranging from the basic and rugged: well site protective matting and THE VOICE: In addition fireproof clothing, to to introducing several Ron Ness, the precise and pricey: speakers, president of the North geographical imagery Dakota Petroleum systems and consult- Council, gave an update on the story of ing services. the Bakken.

The Chatter

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The Bakken magazine June 2013

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After spending more than three hours the first night discussing industry issues and learning about new technology from several of the eventâ&#x20AC;&#x2122;s vendors and representatives, our magazine team left in agreement on one thing: attendees at the show were there to do business. Joe Pendland Jr. and his team from Quality Mat Co., a Texas-based well site protective mat provider, offered perspective that seemed to speak for many at the show. â&#x20AC;&#x153;We have made a substantial investment in the Bakken because it is a longterm deal,â&#x20AC;? he said.

Alison Ritter, public information officer for the North Dakota Department of Mineral Resources, speaking in place of Lynn Helms, DMR director, helped explain why the play presents companies like Penland and others with long-term security.

During her second-day presentation to the

conference review

massive crowd in the general assembly hall, Ritter told the crowd that in 2013, the DMR has permitted 6,000 new Bakken wells, more than what has been drilled in the region to date.

The DMR is adding 23 new staff members, which is important to its efforts in tracking the state of the Bakken, she said.

“We want to develop this play in the most organized way. If we give a really good estimate of all that goes on in the Bakken, we can really help communities plan.”

The DMR booth displayed a large wellsite location map of the Bakken, which Ritter coined the “Shades of Grey,” map. “It tells where exciting areas are and where production is going,” she said.

Ritter wasn’t the only industry voice tasked with updating attendees on the state of the Bakken. Ron Ness, president of the North Dakota Petroleum Council, spoke about the challenges and opportunities for everyone involved with the Bakken. Although daycare services, road infrastructure, electrical power supply and landowner fatigue related to easement paperwork are all challenges in the play, the biggest challenge is flaring, he said. “No matter who comes to North Dakota,” from National Geographic to Time Magazine, he explained, “images on the cover are always the flare, and that is really not the story of the Bakken.”

UP CLOSE: Tremcar's innovative new oil transport tanker was close enough to touch.

The story is instead about the effects of the long-term activity created by oil and gas retrieval. Activity in the Bakken is creating jobs and aiding in the resurgence of rural communities. “Investors and people coming to the Bakken know it,” he said. Ness

reminded the crowd of new diesel refineries planned for N.D., a natural gas-based ammonia plant planned in eastern N.D. and other major infrastructure projects, all of which will help to diversify and expand the Bakken economy.

The Big News

DRILLING ON DISPLAY: Portable units drew attention from attendees entering or leaving the show.

Ness highlighted a handful of bills that will impact the Bakken, and Ritter confirmed that the number of drilling rigs in the Bakken will level off at 180 to 185 rigs in the next year. In total, the conference featured roughly 40 informative and technical presentations. But, for all of the buzz created by companies at the show doing business or the perspective from Ness, Ritter and members from the Saskatchewan Ministry of the Economy, nothing could’ve matched the U.S. Geological Survey’s release during the event.

The Bakken and Three Forks formations are more than double the size thought in 2008, the USGS announced during the show. Considering that booth space for this show sold out in roughly 30 minutes, and the news and buzz, the 2014 conference should be another event of the year. It will be held May 20-22, in Bismarck.

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CONSTRUCTION AND INFRASTRUCTURE

SERIOUS WORK: When Jame Todd, principal engineer for Bartlett & West's energy division isn't working on his own projects, he's looking to add staff and housing for his team.

PHOTO: JACK GLASSER

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The Bakken magazine June 2013

CONSTRUCTION AND INFRASTRUCTURE

Engineering Attention Drilling and production may get the glory, but engineering teams have reason to boast

By Luke Geiver

Engineers don’t get the credit they deserve. In a region where lateral lengths and initial production rates bring both bragging rights and an economic indication element to the long-term viability of oil and gas retrieval, little focus or praise is given to a road construction project or pipeline facility completed in difficult operating conditions. There are no monthly press conferences to highlight the status of construction, gas gathering stations or wastewater ponds.

All most know is that something gets done, not how. When there’s a major announcement regarding the Bakken, it’s most likely about the latest oil resource assessment or some kind of funding issue. Rarely does the story of an engineering crew’s approach to workforce supply, harsh operating conditions or innovative tactics to streamline its

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CONSTRUCTION AND INFRASTRUCTURE

ing with a company assessing the feasibility of developing a synthetic natural gas plant

by South Heart, N.D. The plans for the plant required water, and Todd’s team performed a study examining the options. The same company tasked Bartlett & West to determine the viability for CO2 pipelines at the proposed facility. “They needed to sell that CO2 to Conquering the Learning Curve Bartlett & West is an engineering firm make it economical,” he says. The team was that for roughly 30 years has been providing required to create a permit matrix, or a map the state with rural water access and other re- that would illustrate the type of land and cost lated construction services. Then the energy of land for various pipeline routing options industry came to town. “For us the energy to move the product from South Heart to sector has been great, we have new service places in and out of the state.

The result of that work was a geographofferings because of it,” Todd says. Standing with Todd at his booth during this year’s ical information system (GIS) application Williston Basin Petroleum Conference, and that Todd says, could produce a hypothetical listening to him explain the evolution of his pipeline on a map and then produce the incompany while holding an iPad lit up with formation of every road crossed, every feda western N.D. map featuring colored lines, eral land used, any special land attribute and it was easy to understand exactly how the the type of land (wetland, forest, etc.). Using energy industry has been good for his team. the GIS application, “We could estimate the When asked about any changes or new ap- cost it would be to cross any type of land,” proaches the company had to make to the Todd says. “That was about the same time way it did business, Todd said frankly, “I’ve the Bakken sort of took off,” he adds.

Armed with a cost-estimating tool fit for got a good example for you.”

In 2008, Todd and his team began work- an iPad and capable of providing developers with real-time information regarding the status of a tract of land sited for a pipeline, Todd and his team were ready for the next request from the company.

Following the breakout of the Bakken during that time, “they shifted from the CO2 pipeline to an oil pipeline,” and the Bartlett & West team was able to use the information gleaned from the CO2 exercise.

In doing so, the team had officially joined the list of engineering teams who have/and are transforming the play from a desk. “We had this big learning curve,” he says, in part, because of the speed required to service the oil and gas industry.

DIGGING IN: Wenck Associates and team have expanded from environmental “With energy companies, engineering and are now developing everything from car washes to industrial today everything is yestercomplexes. ability to get a project done receive attention.

Jame Todd, principal engineer at Bismarckbased Bartlett & West, offers one of many examples as to how, and why, engineering firms of every sort have a reason to boast about their work in the Bakken.

PHOTO: WENCK ASSOCIATES

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The Bakken magazine June 2013

day. Efficiency is a huge challenge.” And the steep curve was also due in part to the economic and political atmosphere difference between water and oil.

PROJECT VET: Gabe With the firm’s water Maliscke is using work, landowners had experience on Bakkenbeen donating land based projects to make current projects more easements because the safe. farmers would gain free water in return. “All of a sudden, we had to pay the landowners,” Todd says of the team's oil pipeline efforts. At first, landowners were requesting reimbursement by the acre affected, and then it was by each individual section of pipe. “On initial easements, we were paying $25 per rod and in a year’s time we were paying anywhere from $75 to $250 per rod.”

The efforts by Todd and his team that started in 2008 will pay off in June. The 132mile pipeline that the team has been working on, otherwise known as the BakkenLink Pipeline, will use a combination of 8-inch and 12-inch steel pipeline to transport crude from several N.D. and eastern Montana locations.

But, although the Bartlett & West team may soon be finished with the project, they’ve earned a place as a go-to firm for innovative GIS use. The GIS system helps in many areas, including the management of land ownership. The team used the system on the Fort Berthold Indian Reservation as a means to track easements on the reservation where, Todd says, there could be more than 200 names linked to 1 acre of land, and a minimum of 51 percent of those names must approve the selling or donation of that land easement. Because the GIS software tracks all information related to project management, the team can use its technology in frack water supply lines, saltwater disposal lines and additional pipelines to provide cost estimates to developers and names to lawyers and accountants dealing with land acquisition or use issues.

Work on the BakkenLink has bolstered the company’s record-breaking success over the past three years, Todd says. The success

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WORKING TOGETHER: The demand for engineering services in the Bakken means most firms are willing to collaborate or pass off work.

PHOTO: WENCK ASSOCIATES INC.

can be attributed to their ability to adapt their skill sets to a new area, to instill the trust of energy companies "because now we know the local landowners.”

Navigating the Play

The Bartlett & West team is just one engineering firm that has overcome adversity and found success in the Bakken. Gabe Maliscke, technical manager for the Fargo-affiliated branch of Ulteig Engineers, has figured out how to manage several employees, projects and issues. The firm is currently working on a safety project for the 17 oil-producing counties in the state. The N.D. Department of Transportation has asked those counties to identify hazardous curves or road sections in their respective counties. The Ulteig team is now assessing those curves and sections, and outfitting each with the appropriate signage. “Out of the 17 counties, 15 responded and we have almost 800 sites to look at,” Maliscke says. “That is unique for us because typically we don’t handle that much information.”

To help his team manage the informational overload, he has used a similar approach as Todd’s team. Maliscke and crew are utilizing a GIS-based app to track which sites have been addressed, with what type of signage and which still need work.

North Dakota State Fair Center, Minot, ND

www.usasymposium.com/bakken THEBakken.com

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CONSTRUCTION AND INFRASTRUCTURE

The company is also heavily focused on addressing road conditions on a 20-mile stretch of U.S. Highway 2. After partaking in a similar project last year, Maliscke has adapted to the traffic intricacies created by commercial trucks and a bursting population.

“We got some good ideas on how to handle traffic and how to keep the public safe,” he says of his previous projects. His team now places a premium on limiting side road access to the highway during construction. In addition to a few minor traffic incidents on previous projects, there were a few incidents when a driver drove over fresh concrete.

On an overall project perspective, Maliscke says the No. 1 thing his team has overcome and is now thriving at, is time management. In the past, most engineering firms would work in the summer and design and plan in the winter. “Now there are projects being bid year-round and projects being built all year-round. We have a team that just does bidding now,” he says.

Because the team is constantly working and most projects are bid based in part on a timeline for completion, Maliscke says managing contractors and manpower has become crucial. The Ulteig team even uses its GIS system to monitor manpower. The system allows Maliscke to constantly check the progress of each small team at a road construction site, and if necessary, move in more workers or move off workers to another section based on each team’s progress.

“With technology,” he says, “you can get a lot of work done when you are in the middle of nowhere. Even though nowhere doesn’t really apply to the Bakken now.”

Engineered Bonds

ON LOCATION: Paul Wallick drives to or meets clients every week to ensure each party is up-to-date on planning.

22

As Maliscke implies, there is practically no more nowhere in the Bakken, and it even applies to engineering circles.

Paul Wallick, principal engineer for Wenck Associates Inc., an environmental engineering firm, can attest.

The firms are able to accomplish so much behind the scenes, in part because of the amount of work needed in the region. “I’ve noticed out here that engineering firms, although we are competitors, work together a lot more because we are all busy and we aren’t afraid to trade off services,” Wallick says.

Before working at Wenck, Wallick spent time as an engineer in the Minneapolis area. “It was much more cutthroat in the Cities,” he says. “You knew everybody and it is a small world. You didn’t want to give away who you were working with.” In the Bakken, engineers frequently trade services or hold back from bidding on projects that aren’t within a team’s specialty area, a facet of the play that Maliscke agrees with.

Wallick also believes that to find success in the Bakken, THERE'S AN APP FOR THAT: The iPad application created by Todd and whether is it designing a waste- his team can provide information on land type, ownership status and water pond for a well site, an in- cost estimates for proposed pipeline routes. dustrial complex or an apartment PHOTO: JACK GLASSER building, engineers are learning the importance of showing up. “Being here has opened new offices across the state beis important. Establishing relationships with cause of activity in the oil and gas industry. the city and county people is too,” he says. Maliscke’s Fargo-based team is so busy it has “You still have to make contacts and go out begun to combine work with Ulteig's Bisthere. It is starting to get a little more satu- marck branch. Wallick is working on several projects ranging from industrial complexes rated, it is getting more competitive.”

Engineers are not like oilfield workers to car washes. Each project means learning who can thrive without ever entering a city. new rules, assessing and delegating manEngineers need to be known by city or coun- power, and utilizing any new technology that ty engineers who issue information so that expediates the process, because as each says, they stay up-to-date about the constant zon- there is always more work. “This is going to ing and regulation alterations happening in be a long-term thing,” Wallick says.

Regardless of whether Wallick’s car cities such as Minot, Williston or Dickinson.

The time and effort needed to remain in wash project, Maliscke’s 20-mile stretch of the loop on policies and rule changes is now concrete work on Highway 2 or any of the a major reality for Todd, Maliscke and Wal- new pipeline work that Todd’s team is able lick. Each one says that along with finding to complete in this long-term play is recoghousing for staff members, staying abreast nized, it is clear that engineers are proving of regulatory decisions is a monster time- that any attention they get is earned. consumer. But, for most, if not all engineerAuthor: Luke Geiver ing firms in the region, the efforts put forth Managing Editor, The Bakken magazine outside of designing are worth it. lgeiver@bbiinternational.com Todd’s team is always hiring, he says, and 701-738-4944

The Bakken magazine June 2013

Making it

PRETTY TO PRACTICAL: The future site of the Bakken Village will be a small-scale river town, situated near the Little Muddy River.

Growing the Bakken Village out of prairie

By Chris Hanson

Photos by FourFront Designs Inc.

24

The Bakken magazine June 2013

Thirty-six years after the incorporation of North Dakota’s youngest town, Lincoln, Williams County could witness the organization of the newest municipality, Bakken Village.

Sitting along the banks of the Little Muddy River and bustling U.S. Highway 2, north of Williston, the village will be the location for single-family residences, medium-density housing, a downtown district, light industrial zones and general commercial areas.

South Dakota’s FourFront Design Inc., a company of engineers, architects and surveyors, successfully created, planned and incorporated the town of Summerset, S.D., in 2005. Bryan Vulcan, president, says the two projects, while similar in many ways, have one major differ-

ence. Summerset’s location between Rapid City and Sturgis required more public meetings to establish a consensus among the people already living there. With fewer people, no prior significant development and harmony among the existing neighbors, Bakken Village is a “clean slate” for developers, planners and land owners, Vulcan says.

“If you go back to how towns and cities were created throughout the western United States,” Vulcan explains, “there were very few people that would incorporate and more people would move in there over time.” He adds Bakken Village will follow that model, instead of waiting for development and then trying to foster unity with a higher population. “Starting out with a clean slate from day one with a small group of people that have built that consensus is much easier.”

Vulcan explains the incorporation process requires thorough research and legislative work, including engineering and market studies, a financial analysis, sustainability planning, draft incorporation plans and other information needed by the county commissioners who must approve the project.

The incorporation plan details how the city will CITY BUILDER: Bryan handle streets, Vulcan, president of roads, utilities, FourFront Design has helped to law enforce- Inc., incorporate other cities ment and city in multiple states. governance in accordance with North Dakota statutes. Sustainability planning refers to drafting recommended ordinances, Vulcan explains, so the city has beginning set of rules, plus matching utility and street access. If the city is not successful, tax revenues would

making it

CATTLE CROSSING TO CROSSWALK: The Bakken Village will take the place of ground formerly used for raising cattle.

still go to the county for infrastructure maintenance costs.

If Bakken Village’s incorporation plan is approved by the county, Vulcan expects the results will be similar to those seen at Summerset. “Watching the city government form—the mayor getting elected for the

first time, the councilmen going through initial council meetings and establishing ordinances and how they want to run their city—was a beautiful example of democracy at work,” Vulcan says. He expects community leaders will first hire a finance officer or clerk, and then make

plans to employ a maintenance expert, police officers and other officials as Bakken Village grows.

“The overall vision for the city is a place where people can purchase single-family homes that are affordable, that are sustainable such that people are going to stay there and ride out the ups and downs of the oil economy,” Vulcan explains.

“We think creating lots of apartments is not the way to go. Single family homes, where people invest and can afford them in good and bad economies, are going to keep the city populated.”

“We have a vision for a downtown area with a main street, mixed use retail and commercial activities going on and some residential,” he adds.

Plans include some light industrial and commercial areas, but mostly family-friendly areas.

“There’s green space, parks, trails, areas set aside for schools, and areas set aside for specific niches, such as senior living and veteran neighborhood.”

Vulcan hopes that in 20 years the Bakken village will become “a vibrant, well-run, well-maintained clean community that people can be safe and comfortable in.” The Williams County Commission was expected to consider Bakken Village’s incorporation application in early June 2013.

Author: Chris Hanson Staff Writer, The Bakken magazine 701-738-4970 chanson@bbiinternational.com

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IN PLAY

Spotlight on Safety

By The Bakken magazine staff

Leszek Jaszczak and his team at Fairlight Medical Center in Williston, N.D., perform the type of work that most in the region will never see. As

safety testing and medical service providers for hundreds of oilfield drivers, the team doesn’t want it any other way. “For every guy that had a problem that we sent to get appropriate care after initial tests,” says Jaszczak, “it is another potential accident that you don’t read about.”

After starting a radiology clinic in 2002 with a staff of three, the medical center has grown tremendously, says Lauren Furlong, corporate health coordinator for the center. The clinic has added several employees and several services, ranging from occupational health to agility testing and Department of Transportation physical examinations. “Williston is a quickly growing environment and community, either you grow or you quickly become irrelevant, you either keep up with the competition or you don’t,” says Jaszczak, a board certified radiologist.

To remain relevant, the Fairlight team has had to battle the ongoing challenge of staffing, and according to Furlong, work with a sense of compassion. “That is a big key when you are working with these guys who pick up and leave 26

PROOF OF SAFETY: MBI Energy Services has 33 years of experience in the trucking industry and provides a comprehensive safety plan that includes classroom sessions, on-the-job training and job-compatibility testing.

PHOTO: MBI ENERGY SERVICES

home with no place to live and they’ve been driving all night,” she says. “They don’t necessarily pass their tests on their first try.” Rachel Whittier, R.N., says heavy usage of energy drinks is part of the problem for failed first tests.

Whittier and her team of nurses are working at 120 percent, she says, and in some cases, travel to drilling sites to perform yearly testing procedures for crews who are unable to make time for an in-clinic visit. To increase service efficiencies, Jaszczak hopes to add new technology that will replace

The Bakken magazine June 2013

free weights and extension ladders used to perform basic agility and skills tests each potential oilfield employee must undergo before being hired.

Job-travel, patience with multiple-test recipients or new technology implementation aren't the only aspects the team has had to deal with on a daily basis. The oil world can be small, Furlong says, and because of that, many in the industry change jobs frequently. The turnover and constant change makes it difficult for the clinic to maintain successful working relationships with other compa-

nies, but the team always finds a way. “There have been a lot of good times and a lot of hard times,” Jaszczak says, “but it has been a good ride.”

Paul Wolf, founder of Wolf Technologies LLC, knows all about the proverbial ride in the Bakken and why the issue of safety will always be important. In 2009, Wolf was recognized by Inc. Magazine as a leading entrepreneur for his trailer light safety check system. The system allows trailer operators, including commercial and overthe-road users, to verify the status of all trailer lights by plug-

IN Play

GROWING SAFELY: Leszek Jaszczak, works 10-hour days to provide medical testing and other services. He also finds time to help hire staff and maintain the clinic.

PHOTO: Steph Slabodnik

NOT TO BE OVERSHADOWED: After starting with a team of three, the Fairlight Medical Center group has grown in size and experience in what it takes to operate in Williston.

PHOTO: Steph Slabodnik

ging into a device he originally made out of Radio Shack parts and a plastic box. The system performs a diagnostic check to verify all turn signals work and open or short circuited wires don’t exist. The system saves on labor costs related to timeconsuming testing, reduces highway inspections related to faulty lights and provides a level of safety in bumpy and muddy working conditions. “The device is extremely important for the oil industry for that very reason. They are driving on bumpy gravel roads and muddy roads. Those are all things that cause an increase in trailer light failures due to wire chaffing or bouncing inside the frames,” he says.

Today, the system is used

by rental equipment companies across the country, he says, and more operators including contractors hauling equipment and over-the-road fleets in the Bakken are purchasing his testing unit. The commercial users represent the largest possible market for his Mandan, N.D.-based company. “I think that there is an awareness of that,” he says, for both his company and by fleet operators looking to add another element of safety to their own teams.

Recent work from the American Trucking Association helps to illustrate Wolf ’s point.

The ATA teamed up with the oil industry to compile a list of recommendations for roadway safety and driving practices earlier this year. “Trucks are essen-

SMALL DEVICE, BIG GAINS: The Trailerlight Check system helps monitor trailer light systems after jarring road trips.

PHOTO: WOLF TECHNOLOGIES LLC

tial workhorses of our country’s ability to take advantage of our shale gas and oil resources,” according to John Conley, cochair for the National Tank Truck Carriers. But, the industry also has a responsibility to be safe, he added. Safety pro-

viders like Wolf or the team at Fairlight Medical Center are doing their part. “I think it really shows that what people are capable of is impressive,” Furlong says of safety service providers in the Bakken.

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Research

PROVINCIAL EXPERTS: Dan Kohlruss has earned a PhD. working on oil and gas plays from the Canadian portion of the Bakken to the oil sands of western Saskatchewan.

Canada’s Bakken Rock Stars

By The Bakken magazine staff

Photos by Saskatchewan Ministry of the Economy

28

The Bakken magazine June 2013

Melinda Yurkowski and her team at the Saskatchewan Geological Survey’s Ministry of the Economy are all just a bunch of rock stars. Not only did the team spearhead this year’s agenda for the Williston Basin Petroleum Conference, putting together a comprehensive look at the geology of the Williston Basin and what developers of

all sorts need to know, the team has one of the most complete core collections in the Canadian portion of the Bakken play. “If there is a core of a well, we can say with 99 percent certainty that we have it and we can show it to you,” Erik Nickel, petroleum research geologist says. Although the team is tasked with covering every geological formation in the entire province, according to Yurkowski, a task that also includes work on the oil sands, helium deposits and tracking one of the world’s largest deposits of potash, Yurkowski says the team has proven itself as the provincial experts in geology.

“We’ve been working on the Bakken for a number of years,” says Dan Kohlruss. “We are trying to promote the development of it and trying to look for areas outside of it that we can point people too or tell people about.”

Doing so means explaining the challenges or pitfalls of a certain area, Kohlruss says, and what the differences are between the U.S. Bakken and the Canadian Bakken. Like the U.S. play, the Canadian play gained interest around 2006, and although the Canadian play offers a huge resource that

Researchers

continues to produce at high volumes, the play is smaller than the U.S. version.

Holding the title of expert means the team tracks development on both sides of the border, however. “We try and find a balance between being proactive and reactive,” Nickel says. In some cases, the team works to churn out research on a hot formation so those affected can understand how to steward the resource in the best possible way. In other cases, the team tries to take a proactive approach to oil and gas development by looking at areas where industry isn’t, Nickel adds.

Early in the Bakken’s Canadian activity, the team was taking a proactive approach, Kohlruss says. Certain geologists were on the cutting edge of helping to promote Bakken drilling and exploration. “You could see the writing on the wall,” he says.

VISIONARY: Melinda Yurkowski, assistant chief geologist, leads a team of eight oil and gas-based geologists in explaining hot plays, and finding future plays.

“As the drilling and the wells on production came up, there were a lot of calls asking what was going on,” Nickel says. “We were able to provide a lot of geologic research to help with that.” The team is currently mapping water usage in the Canadian portion of the play while also looking at decline graphs. “That is pointing to some interesting things on how to best manage a Bakken well,” he says, including a movement into secondary recovery using water flooding.

The team’s ability to monitor both proven and emerging resource formations also helps other organizations in the prov-

WELL SITE SANCTUARY: Core samples from nearly every well drilled in the province is kept by the Ministry of the Economy team.

ince. Yurkowski and others have been able to work with and indicate to other research-based or privately run institutions which technologies or approaches to resource development are already, or will be, in high demand.

Providing a light to the darkness, as Nickel says, is only one part of holding the expert title. The team also must decipher if a play, the Bakken included, needs any additional information. “We need to guide companies on how to work on the Bakken the best, but we also

need to look at areas that are a little quieter and point them in those directions so we are encouraging more than just the hot play,” Kohlruss says. For now, maintaining their rock star status means focusing a majority of their efforts on the Bakken, because according to Nickel, “The play is by no means completely mature now or finished.”

THEBakken.com

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