BISMARCK — A new set of North Dakota revenue projections predict a sunny short-term future for the state's oil industry and a quicker post-pandemic economic rebound than previously expected.

Moody's Analytics and the state Office of Management and Budget presented a forecast to budget writers Tuesday, March 16, that expects the state to receive nearly $4 billion in oil tax revenue during the next two-year budget cycle — a full $1.1 billion more than a projection presented to lawmakers in November. The massive pot of oil revenue flows down to counties, cities, the Three Affiliated Tribes and more than a dozen funds and programs, including a voter-approved savings account known as the Legacy Fund.

The projection assumes 1.1 million daily barrels of oil production at per-barrel oil prices of $53.50 in 2022 and $48.75 in 2023 — much higher than the $40 estimate lawmakers have used as a baseline since January. The West Texas Intermediate price, a benchmark for Bakken crude oil, hovered around $65 a barrel on Tuesday.

Moody's projection also predicts a $54 million increase over the previous forecast in General Fund revenue, which mostly comes from sales tax, income tax and a sliver of the oil tax.

The Legislature’s budget consultant, IHS Markit, offered a separate forecast that predicted similar levels of General Fund revenue.

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The firm brought up several scenarios for oil tax revenue, including one in which the administration of President Joe Biden shuts down the Dakota Access Pipeline. That would mean higher oil transportation costs that hurt North Dakota companies and drive down production, one analyst said. Senate Appropriations Chairman Ray Holmberg, R-Grand Forks, said lawmakers will just have to be conservative in determining spending levels to account for the added risk.

Holmberg said the latest forecasts are "positive" and provide lawmakers with a "psychological boost" heading into the final stretch of the budgeting process.

Legislative leaders will likely use the two projections as "guardrails" to come up with a "conservative" amount lawmakers can spend and propose the figure to the appropriations committees later this week, Holmberg said.

Republican Gov. Doug Burgum said the new "better-than expected" forecast put the state in a good position to maintain General Fund spending levels without raising taxes. Burgum proposed a $15 billion budget in December that includes billions in federal funding along with state revenues.

Separately, researchers on Tuesday presented a backward-looking analysis on the economic impacts of North Dakota's oil industry, highlighting the sector's hefty contribution to the state's finances and tax revenues.

According to an analysis by the consulting firm AE2S commissioned by the North Dakota Petroleum Council and the Western Dakota Energy Association, taxes on the industry brought in more than $22 billion for the state between 2008 and 2020, including more than $8 billion that went into county coffers. The study found that Cass County was one of the leading tax beneficiaries in the state, behind just Williams and McKenzie counties, two of the state's top oil producers. Cass drew more than $870 million in oil tax revenues over the 12-year stretch measured by the study.

Tax revenues off of the oil industry in 2020 took a predictable drop, according to the study, but the gross of over $2 billion was still substantially higher than the amount collected by the state in the years after the mid-2010s oil bust.

A second study by researchers at North Dakota State University found that the oil industry accounted for more than a quarter of North Dakota's gross state product in 2019, the most recent data available, and had a total impact of $40.2 billion in that year.

And though the NDSU study examined past industry performance, one of its lead researchers said the state could draw lessons from the recovery following the last bust for today's pandemic recovery.

Thanks to technological strides and a more stable workforce compared to the last oil price downturn, economic research scientist Dean Bangsund said the industry today "is in a much better position to withstand market shocks."

Readers can reach Forum News Service reporters Adam Willis, a Report for America corps member, at awillis@forumcomm.com, and Jeremy Turley at jturley@forumcomm.com or on Twitter at @jeremyjturley.