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Watford City mayor: Falling oil prices are 'a blip in the road'

Watford City mayor Brent Sanford talks about challenges his city faces during a session at the Bakken Conference and Expo at the Alerus Center Monday. photo by Eric Hylden/Grand Forks Herald1 / 2
Vendors begin to set-up booths at the second annual Bakken Conference and Expo at the Alerus Center in Grand Forks. photo by Eric Hylden/Grand Forks Herald2 / 2

The sky above Brent Sanford's head isn't falling.

As mayor of Watford City, a western North Dakota town in the heart of the state's oil boom, he's often asked these days if falling oil prices are bringing a bust to his community. But during a presentation Monday in Grand Forks, he talked instead about infrastructure projects his community needs to support what he expects to be long-term oil production.

"The $50 oil is definitely bringing out the Chicken Littles," he said. "I honestly believe this is really a blip in the road."

Sanford was speaking at the second annual Bakken Conference and Expo at the Alerus Center, hosted by Grand Forks-based BBI International. The first day of the three-day event included presentations from researchers, regulators and energy industry officials involved in the Bakken oil formation in western North Dakota.

The event comes after a decline in oil prices over the past year, prompting some to raise the specter of a "bust" in western North Dakota, an area that's seen a flood of investment and new workers in recent years.

But Sanford was optimistic, and said oil companies haven't said they won't drill their planned wells.

"The speed at which they drill them is being impacted by the price, but not their eventual plans to drill them or not," he said.

North Dakota had 73 active drilling rigs on Monday, down from 193 a year ago, according to the North Dakota Department of Mineral Resources. During that time, the price of a barrel of oil dropped from $104.29 to $50.59, according to the U.S. Energy Information Administration.

North Dakota's top oil regulator Lynn Helms said Monday the drilling slowdown is "not a bust," and pointed to the roughly 20 drilling permit applications the state gets daily.

Closing the gap

Watford City is still catching up to its citizens' housing needs, Sanford said. He said 30 to 40 percent of students in the community still live in campers.

"It's a serious concern, having that many people living in campers," he said. "We've got a huge gap that we're still trying to close."

Watford City leaders hope to learn from the last oil boom and bust of the 1980s, which was handled with "temporary facilities," Sanford said.

"The bust left us cheap industrial shops, vacant RV parks, outmigration, declining school enrollment," he said. "It certainly wasn't pretty."

Now, the city is focused on long-term investments like permanent housing, an events center, wastewater plant and new hospital, Sanford said.

Sanford's positive outlook was backed by North Dakota State University researcher Dean Bangsund, who said the "economic opportunity, long-term, is still very valid."

"The dip in prices has not affected the oil in place. Oil does not migrate in the shale," he said during a presentation on the oil and gas industry's effect on the state's economy. "I think we're going to continue to have economic opportunities in North Dakota."

John Hageman

John Hageman covers North Dakota politics from the Forum News Service bureau in Bismarck. He attended the University of Minnesota in the Twin Cities, where he studied journalism and political science, and he previously worked at the Grand Forks Herald and Bemidji Pioneer.  

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