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Stepping up oil production comes with concerns

Stepping up oil production in the U.S. is the hot topic since Russia invaded Ukraine. But stepping up production comes with concerns.

Last week Lynn Helms, director of the North Dakota Department of Mineral Resources, during his monthly report on new oil and gas numbers, said leasing or permitting wells on public lands is not being done.

“That’s consistent with the strategy or the attitude of the current administration,” Helms said.

President Biden shut down oil and gas leasing on public lands during his first days in office.

North Dakota produced 1.086 million barrels of oil a day in January, the most recent figures available. The Fort Berthold Reservation produced 212,593 barrels of oil a day in January. No wells were actively drilling on federal surface or public lands, according to the Mineral Resources Department.

Helms said he counted 13 policy decisions that have been made over the last year and a half “that were all negative to oil and gas and none of those have been reversed in light of the current world shortage for crude oil.”

He did point out a positive signal though.

“The only positive signal out there is the price,” Helms said. “It makes you a little curious why are oil and gas companies not really ramping up activity.”

Helms said he talked to a couple large operators in North Dakota about this. “The first thing that they cited was their investors want this to be cash flow and return on investment. They are not interested in seeing the profits from this higher oil price being plowed into new wells and new infrastructure in the face of an administration that long term wants less oil and gas production,” he said.

“They’re thinking long term and they’re saying ‘Hey, we’re just looking for a return on investment. We’re not looking for reinvestment of this money in an industry that long term has been designated as one that there should be less of, not more of,'” he said.

He said the operators also cited workforce issues. “Those have not abated. Industry is just really in a very difficult situation trying to find workers to ramp up production and activity,” Helms said.

According to the oil and economic experts, the U.S. would not need to import oil from Russia and should not look to other countries for it because we have plenty of resources here on this land.

Biden should call a truce with U.S. oil and gas producers for the long term so production on public lands can start up and continue including here in North Dakota.

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