What America's Oil Boom Looks Like From Space
Late last year, NASA released new high-definition photographs of the Earth at Night. In these photos, you can see the city lights of Minneapolis and Chicago glittering against the night sky. A little further west, a patch of lights burns almost as bright in rural North Dakota. The source? The state’s booming oil and gas industry.
As developers have raced to coax oil out of the Bakken shale formation through hydraulic fracturing, they have created a new “metropolis” of oil drilling pads in rural North Dakota – and the oil fields are creating far more than just light pollution.
In the Bakken, much of that light is produced by burning off—or flaring—natural gas that is produced as a byproduct from oil wells. Modest investments are being made in pipeline and processing infrastructure to capture and get the natural gas to market, as well as other solutions such as using it to power onsite generators. But in the race to get the higher-priced oil out of the ground as quickly as possible, many companies are simply burning it.
According to the North Dakota Industrial Commission, approximately 240 million cubic feet of gas is flared every day in the state’s oil and gas industry. If that energy were captured, it’d be enough to heat half a million homes. (Just to be clear, that’s 500,000 homes’ daily heating demand up in smoke each day.) Not only is flaring a massive economic waste, it also affects regional air quality and creates significant greenhouse gas emissions that are wreaking havoc on the climate.
Acting on these concerns, investors at Mercy Investment Services have filed a shareholder resolution with Continental Resources, a major Oklahoma-based oil developer operating in the Bakken, requesting that the firm “adopt quantitative, company-wide goals, based on current technologies, for reducing or eliminating flaring in all operations and facilities under the company’s financial or operational control.”
Mercy Investments is right to raise the issue with Continental, which recently bought up $650 million in Bakken real estate. And they’re not the first investors to voice their concern over flaring. Last year, investors representing $500 billion in assets sent a letter to 21 of the industry’s largest shale oil producers, including Continental, urging them to reduce or eliminate flaring.
Their message? The flaring of natural gas represents a waste of valuable product – hundreds of millions of dollars of lost revenue – and “annual emissions of at least 2 million tons of carbon dioxide, as much as adding 384,000 cars to the road.”
Unless the industry takes more aggressive action, flaring will continue at present levels and might even increase along with booming production. North Dakota officials say they would like to reduce flaring to below 10 percent, but enforcement of flaring regulations has been lax at best.
As one of the biggest players in the Bakken, Continental should demonstrate leadership in tackling this important problem.