Hamm it up

Harold Hamm, the billionaire Oklahoma oilman who is drilling more wells in North Dakota than anyone, traipsed back and forth across UND's campus all Friday, talking to politicians, researchers and local businessmen.

But it was students who seemed to be his favorite audience.

He kept a classroom of 300 UND students quiet for an hour, answering their questions about oil and succeeding in life.

He told them to "follow your dream."

It was as a young student himself, in a similar gathering listening to a successful entrepreneur in high school that he first was inspired to try his hand at forging his own destiny, Hamm told the rapt students.

"It was a man named John Frank," he said of the man who started a pottery business in Oklahoma in the 1950s and 1960s. "He said to find something you are passionate about. I remember he was sitting up there working at a pottery wheel as he talked to us. And I was working night and day at the time, at a service station, pumping gas. And I thought, 'What do I have to be passionate about?'"

But he looked around where he was living in Enid, Okla., and realized he was among some interesting people.

"They were oil men. They were generous and charming and adventurous. I started thinking I wanted to be in the oil business."

It's worked out pretty well.

Hamm, 64, was worth $5.8 billion in September, according to Forbes' listing of the richest Americans.

Continental Resources, the oil and gas company he founded 40 years ago, is one of the biggest players in the nation's oil fields and the biggest in North Dakota in drilling new wells.

Bullish on N.D.

He still lives in his hometown of Enid, but more and more he find himself in North Dakota, he says.

A few weeks ago, he flew up in his jet along with his Black lab, Coal, to hunt pheasants in southwest North Dakota.

He's given $1.8 million to the state's Heritage Center.

He's spoken to students at North Dakota State University in Fargo, at Concordia College in Moorhead and at the University of Mary in Bismarck.

Friday, he met with lawmakers for an hour, had lunch with UND President Robert Kelley and Gov. John Hoeven and two dozen other heavy hitters at the Energy and Environmental Research Center. He stopped in at the school's research on petroleum and geology and checked out the core sample library where he first spotted good looking oily rocks back in 1992 and decided to move in big time to North Dakota's Oil Patch.

But in a huge lecture bowl filled with students on a Friday afternoon, Hamm seemed most comfortable.

"I really like talking to students," he said.

He was clear that he needs them, too.

Hamm told the students that his company would pay a newly graduated UND engineer $75,000 to 85,000 a year as starting pay. "That's good wages," he said, adding with a laugh: "And if they are a good negotiator, he could get us up higher."

It's a real offer, he said.

"We are out hiring 40 people right now."

His company has about 22 rigs drilling now in North Dakota, the most of any oil company.

"We plan to double that within five years."

Hamm is more bullish than most on North Dakota's oil potential.

He said Friday his company has done it's own "scoping" of the Williston Basin's Bakken Formation spread across western North Dakota, eastern Montana and parts of Canada and figures it holds up to 24 billion barrels of recoverable crude oil. That is five times the estimate the U.S. Geological Survey made in 2008 about the Bakken's recoverable oil.

And it would make the Bakken a bigger play than the Prudhoe Bay oil field on Alaska's North Slope, usually considered North America's largest oil field with about 14 billion barrels of recoverable crude; most of it has been pumped out.

Hamm called Friday for state and federal officials to again officially assess the Bakken and Three Forks' potential, as well as the newly announced Tyler Formation lying atop the Bakken. Such information will aid - and promote - the industry developing the potential, Hamm said.

In response to a student's question, Hamm said the BP oil spill in the Gulf last spring, while a tragedy that took lives and made a mess, led to some good things.

"One was how BP stood up and took responsibility and put $20 billion on the table and said 'We are going to make it right.' Another thing was how the whole industry came together and did an excellent job cleaning up."

The damage from the oil ended up being far less than feared, Hamm said.

The potential of oil for the state hasn't been reached, he said.

A new study has found that each drilling rig in the state has an economic impact of about $120 million per year, with the value of the oil and all the employment and investment related to producing the well, Hamm said.

Ron Ness, president of the North Dakota Petroleum Council, said his organization commissioned the study recently completed by economists at North Dakota State University.

There are 164 rigs drilling in the state as of Friday, according to the state Department of Mineral Resources, meaning the total economic impact of the oil development in a year would be nearly $20 billion.

But Hamm said North Dakota has the highest taxes on oil production of any of the oil -producing states and hopes they can be lowered and simplified so oil firms can plan for the future.

President Barack Obama's announcement this week that he would impose a moratorium on off-shore drilling off the Atlantic coast and the eastern side of the Gulf of Mexico came out of nowhere, Hamm said. "That did surprise me. It was the opposite of what he had been saying."

Hamm is concerned about the movement to halt hydraulic fracturing, the technology that uses high pressure water, sand and chemicals to break apart and prop open the shale and rock, allowing recovery of natural gas and oil. The New York state assembly recently passed a moratorium against the process over concerns that "fracking" in gas fields was contaminating water supplies.

If that idea spreads to North Dakota oil fields, it would be a disaster, Hamm said.

"If there is a moratorium on fracking, we'd be done," he said.

There is no danger to the state's water aquifers, because the fracking is 2 miles below ground, far under any water supplies, he said. "And all we use (for fracking) is water and sand, and a little soap," he said.

Hamm said he and most industry leaders would be willing to disclose the make-up of their fracking compounds, which many have considered proprietary information to be kept from competitors.

Hamm says the oil industry is more transparent than ever, with information shared from company to company. "It's impossible to keep a secret on the oil field," he said.

Reach Lee at (701) 780-1237; (800) 477-6572, ext. 237; or send e-mail to slee@gfherald.com .