Keeping the "Boom" in Boom - KXNet.com - Bismarck/Minot/Williston/Dickinson-KXNEWS,ND

The "Boom" in Boomtown: Impact and Staying Power

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  Is the "boom" in Boom Town here to stay this time?  Industry experts think so.


Spend a dollar here, create a buck-fifty there -- so says the North Dakota Petroleum Council.  According to their new study, each dollar spent in-State by the oil and gas industry generates $1.59 in additional business activity.  This translates to 30.4 billion dollars in economic impact resulting in 60,000 jobs statewide -- and that's just for 2011.

"I sit in my office in Watford City, North Dakota.  I meet multi, multi-million dollar investors on a weekly basis.  And they're trying to find out how real this is," says Gene Veeder, Director of McKenzie County Economic Development.  North Dakota Petroleum Council President Ron Ness says, "the revenue is there.  We're not just starting this Bakken play.  We're six years into the Bakken in North Dakota.  They can make long term investments."

When it comes to public infrastructure, investment is full steam ahead in the oil region.  "As of right now, either completed since the oil boom or in activity, these few communities have completed $500 million worth of infrastructure work to accommodate the population growth," says Steve Burian, CEO of Advanced Engineering and Environmental Services, Inc.

Though growth is not without challenges, the Petroleum Council says their findings present a unique opportunity for North Dakota.  "Having challenges and issues associated with growth and development are far better than trying to manage challenges associated with a contracting or stagnating economy," says Nancy Hodur, Assistant Research Professor at NDSU, Department of Agribusiness and Applied Economics.  

One of the lingering challenges is housing.  Projections show Watford City population will go from 1,500 to at least 8,000 people over the next several years.  "We have not found a state solution for that.  The solution is the jobs that are out there.  Those people have jobs to fill those apartments and houses.  That creates the economic model that creates the investment and gets those sticks going up," says Veeder.

The overall sentiment among these experts is that with proper management, this boom is going to last.  Says Hodur, "it's here.  It's real and it's going to stay."

The Petroleum Council study says the oil and gas industry generated $2.6 billion in State and local government revenue in 2011 alone.  So they say the money is there to make the necessary investments to ensure North Dakota diversifies it's economy into the future.

 

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