Tuesday in Havre, people attending the first of a series of lectures about energy and the Hi-Line heard a fairly consistent message: While an energy boom like North Dakota and north-eastern Montana is not likely to hit north-central Montana any time soon, the region should prepare and likely will see activity.
The lectures were the first in an “occasional” series sponsored by Montana State University-Northern, the Havre Area Chamber of Commerce and Bear Paw Development Corp, said Northern Chancellor Jim Limbaugh.
“There’s a lot of truths, mistruths, speculations, rumors — some true, some unfounded — about the explosion of energy development in the Bakken and eastern Montana and how it affects us, and we felt we had a responsibility as residents of this community to bring out information about the energy options here in north-central Montana and, more importantly, how it affects us both in the future and in the present, ” Limbaugh said.
Jay Gunderson, research geologist with the Montana Bureau of Mines and Geology, said the geology of north-central Montana makes it unlikely that an oil boom like in the Bakken farther east will happen any time soon.
While some oil is present and being drilled at a few wells — most likely due to a formation that is producing oil in Saskatchewan north of Chinook — the region mostly contains coal and natural gas, he said.
While large amounts of coal are present, it is more difficult to access than coal in other areas of the state, such as in the Powder River Basin, he said.
The region does have the potential to develop production of coal-bed methane, but with the drop in prices of natural gas, that is unlikely to come about any time soon.
The region also has an abundant supply of natural gas, mainly due to collection in fault lines from the creation of the Bear Paw Mountains. Those reserves extend 30-40 miles both north and south of the mountains, Gunderson said.
The U. S. Geologic Survey has estimated north-central Montana contains six trillion cubic feet of natural gas — enough to supply 100 years of gas at the production levels last year.
“This area dominates in gas, ” Gunderson said.
The region also supplies most of the gas in the state — 88.7 percent of last year’s production, he said.
But, with gas prices down, no major increase in production is likely to happen soon, Gunderson said. But that demand is cyclic, he added.
“So, I think there are lots of opportunities yet to come …, ” he said. “Companies will continue (to explore for and produce gas), I think particularly when the gas price comes back. ”
He added that the situation with coal and oil also could radically change — the Bakken formation was discovered on the land of Henry Bakken in North Dakota in 1951, but the technology did not exist to economically extract it until recently.
The boom occurred starting about 2000, when improvements to horizontal drilling and hydraulic fracturing — both technologies that had been around for decades — allowed the oil to be extracted where the companies drilling could make a good profit.
If exploration found as-yet undiscovered oil deposits, or technological improvements — or the price of oil — changed the economics, north-central Montana could see more drilling.
“I don’t want to give the impression that oil is a non-factor in north-central Montana, ” Gunderson said.
And even without an oil boom, the area could be impacted.
Tony Preite, Northern’s director of university outreach and the U. S. Department of Agriculture’s Rural Development coordinator, said Northern already is taking action.
As Rural Development coordinator, Preite helps communities impacted by the activity on the Bakken to find, contact and work with the multitude of federal agencies that could provide assistance.
He also has worked on a project to help provide education and training. Northern is taking the lead, along with Miles Community College and the Fort Peck Community College, in putting together a list of what programs Montana’s colleges and universities have that could be used to train workers in the Bakken.
He said a forum in Miles City was a success, with more than 100 representatives of businesses and industry involved in the oil production in the Bakken hearing what the Montana University System has to offer.
“The main purpose of this was to let … the doers. the owners, the big wheels know that the Montana units of education are very interested in meeting the skill needs for Montanans to be employed in those higher-paying jobs, ” Preite said, adding that the Montana colleges and universities like Northern also are very willing to expand, or if the demand is heavy enough, create new programs.
He said he just wrote an article about to be published in the Montana Policy Review about the challenges and opportunities the 16 eastern Montana counties face with the energy development occurring.
Leslie Messer, executive director of Richland County Development based in Sidney, talked about those challenges.
They include the cost of an average home going from $75,000 to $275,000 and apartments from $250 to $450 a month to $800 a month or as high as $3,000 a month.
The county landfill went from about 7,000 tons of garbage being deposited a year 10 years ago to 33,000 tons today, traffic calls including general calls, driving under the influence of intoxicant calls and traffic offenses up 45 percent, classroom enrollment up 30 percent and emergency room visits up 55 percent.
Messer said that, while people hear horror stories, the county and municipalities have been planning and working together to resolve problems.
A key is planning, and being in contact with the groups and companies to find out what they are doing, what can be planned and how the local governments and organizations can help, she said.
While the Hi-Line may not see an oil boom like Sidney, it is being impacted and could see an explosion itself — something as diverse as the oil companies wanting sandstone from this area to use in hydraulic fracturing, creating another new industry.
Knowing what people and companies will be doing, and where, is key to keeping ahead of major problems, Messer said.
“If I were looking in the rearview mirror and saying, ‘What can I learn from all this stuff, ’ you need to find out who’s coming already, ” she said. “They’re sniffing around the community, you know they are. Ask what they need. ”