Interior Secretary Gets Firsthand Look At Bakken

U.S. Sen. John Hoeven, left, and U.S. Interior Secretary Sally Jewell visit a Statoil drilling rig location near Williston, N.D., on Tuesday, Aug. 6, 2013. Amy Dalrymple/Forum News Service

WILLISTON, N.D. – During her first visit to North Dakota as secretary of the interior, Sally Jewell said it’s clear to her that oilfield operators and the state recognize that more work needs to be done to reduce natural gas flaring.

“Flaring it and venting it is obviously not capturing resources that could be leading us to energy independence,” Jewell said Tuesday.

Top executives of two oil companies gave Jewell a tour of their North Dakota operations, focusing on technology advancements and efforts to reduce natural gas flaring.

A recent report estimated that $3.6 million in natural gas is burned away each day in North Dakota.

U.S. Sens. John Hoeven and Heidi Heitkamp invited Jewell to tour the Bakken to see the state’s oil and gas development firsthand.

“There is no question that this is the epicenter of many aspects of energy development in this country,” said Jewell, who was sworn in as secretary in April.

U.S. Interior Secretary Sally Jewell speaks during a media briefing at a Statoil facility in Williston, N.D., on Tuesday, Aug. 6, 2013. From left are Sen. Heidi Heitkamp, Neil Kornze, principal deputy director for the Bureau of Land Management, Sen. John Hoeven and Lt. Gov. Drew Wrigley. Amy Dalrymple/Forum News Service

Officials who helped lead the tours included Continental Resources CEO Harold Hamm and Statoil Senior Vice President Torstein Hole, who is based in Norway.

Continental Resources gave Jewell a tour of a location adjacent to a residential area in Williston that will have 14 oil wells on the same location, minimizing the footprint on the land.

Statoil showed the group a location in the city limits of Williston that had pipelines in place ahead of time, capturing the natural gas and eliminating the need for of thousands of truck trips to transport oil and water.

Across the state, about 29 percent of natural gas is flared, Hamm said. But Continental Resources flares 10 percent of its natural gas and captures 90 percent, with a goal to reduce the flared amount even further.

“It’s valuable and we collect it all,” Hamm said. “We’re not going to waste those hydrocarbons.”

Hamm said he expects other companies will catch up and bring that percentage down.

“They’re getting there real quick,” Hamm said of other companies.

Energy Secretary Sally Jewell visits with Continental Resources CEO Harold Hamm (right) and COO Rick Bott at Atlanta Well Pad near Williston, N.D.(Bureau of Land Management)

Statoil currently flares 30 percent of the natural gas it produces due to infrastructure challenges, said Lance Langford, Statoil vice president who oversees Bakken operations.

But the company is working to reduce that percentage through the use of bi-fuel rigs, which use natural gas and reduce the amount of diesel required, and technologies that will extract the valuable natural gas liquids.

Statoil also showed Jewell a pilot project the company is working on to test a compressed natural gas liquids unit.

Jewell, whose background includes working as a petroleum engineer, asked technical questions during the tours, such as how wet the gas is and how operators build a curve to drill horizontally. When touring a drilling rig, Jewell commented that there were “no chains flying around like when I was in the industry.”

Hoeven said the goal of the visit was to emphasize that North Dakota’s approach to energy development, rather than a federal one-size-fits-all model, is producing more energy with better environmental stewardship.

“This country needs to develop a comprehensive energy plan as well,” Hoeven said. “The secretary can be very instrumental in that development.”

As Interior Secretary, Jewell plays a key role in energy development on public and tribal lands. She referenced President Barack Obama’s all-of-the-above energy policy and said “he believes it deeply.”

Jewell said she’s in favor of having federal baseline minimum standards for hydraulic fracturing that would include requirements such as disclosing the chemicals and ensuring the integrity of the wellbore.

While North Dakota and other states are sophisticated, other states don’t have experience regulating fracking, she said.

“There are a number of states that don’t have standards at all,” Jewell said.

If states’ standards meet or exceed the federal standards, operators would follow those state standards, she said.

Heitkamp, Hoeven and Lt. Gov Drew Wrigley, who also participated in the tour, repeatedly emphasized a states-first approach to energy development.

“No one knows the hydrology and geology of North Dakota better than the people who have been studying for years,” Heitkamp said.

Officials also said they are partnering with Jewell on efforts to improve the efficiency of the Bureau of Land Management, which experiences backlogs in keeping up with drilling permit applications in the Bakken.

Jewell’s tour concluded Tuesday with a visit to Theodore Roosevelt National Park.

Jewell also planned to meet with Three Affiliated Tribes Chairman Tex Hall on Tuesday, but he got caught in traffic.

“The fact that he got stuck in traffic when we had a 7 a.m. breakfast meeting says something about the boom going on here,” Jewell said.