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Spotlight on Economics: Growth in Petroleum Sector Sparks Need for Research

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Nancy Hodur - Research Assistant Professor, NDSU Agribusiness and Applied Economics Department Nancy Hodur - Research Assistant Professor, NDSU Agribusiness and Applied Economics Department
State and local decision makers, regulators, developers and others are in need of information about the scope and scale of the growth and development of the petroleum industry to plan for the future.

By Nancy Hodur, Research Assistant Professor

NDSU Agribusiness and Applied Economics Department

The recent and unprecedented expansion of the petroleum industry in western North Dakota is presenting numerous challenges for communities. Resources and infrastructure are strained. State and local decision makers, regulators, developers and others are in need of information about the scope and scale of the growth and development of the petroleum industry to plan for the future.

The demand for information has led to a call for research to provide information that can be used to guide decisions and planning efforts. My colleague Dean Bangsund and I are working on several projects in western North Dakota to help address the need for science-based information on the petroleum industry and its effect on employment, housing and population.

The foundation of our efforts is a petroleum industry employment model that illustrates the potential employment effects of various scenarios on the rate and extent of development in the Bakken and Three Forks oil shale formations. The model also is being used to help estimate potential demand for housing.

Our efforts are nearing completion for the city of Dickinson, where we modeled the potential effects of the petroleum industry on employment and housing. In the coming months, we will be undertaking a similar study for the city of Williston. We also will be examining the impacts of potential population growth on five school districts in western North Dakota for the Association of Oil and Gas Producing Counties.

We are one of several groups working with the engineering firm of Kadrmas, Lee and Jackson on a Williston Basin study sponsored by the North Dakota Transmission Authority. The study will examine the impact of the petroleum industry on the electricity transmission system. We also are working with Kadrmas, Lee and Jackson to examine the economic impacts of a Highway 85 bypass around the community of Alexander as part of an environmental assessment of the bypass.

With the exception of the city of Dickinson project, the remaining projects will be completed toward the end of the year.

The explosion in activity in the petroleum sector in western North Dakota has created tremendous opportunities and challenges. We hope the results of our research will provide leaders with the kind of information they need to help make decisions that address both the opportunities and challenges created by the development of the Bakken and Three Forks oil shale formations.


NDSU Agriculture Communication – May 10, 2012

Source:Nancy Hodur, (701) 231-7357, nancy.hodur@ndsu.edu
Editor:Rich Mattern, (701) 231-6136, richard.mattern@ndsu.edu
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