A study of the electricity needs in the oil/natural gas patch was funded Monday by the North Dakota Industrial Commission for upcoming work to be overseen by the state's power transmission authority. Separately, the commission also authorized paying for another study of future natural gas growth in the state.
The growing strain on traditional electricity supplies and infrastructure in the Bakken Shale and other hydrocarbon basins in the state has been noted by MDU Resources Group Inc., whose Montana-Dakotas utilities serve the region, and by distributed generation providers such as California-based Capstone Turbine Corp. (see Shale Daily, Feb. 6; Jan. 10).
On Monday the Industrial Commission agreed to provide $100,000 toward the cost of an estimated $284,000 study. MDU's utilities and the state's major user-owned utility, Basin Electric Power Cooperative, will pay for the rest. The study is slated to be completed by September and conducted by Bismarck, ND-based engineering firm Kadmas, Lee & Jackson.
The study is expected to project estimated power demand growth and explore options for new and enhanced electric transmission lines. It also will examine the question of whether the two utilities involved should develop additional generation sources.
Transmission Authority Executive Director Sandi Tabor told the Industrial Commission there are "growing concerns that the infrastructure in western North Dakota may not be sufficient" to meet the current rapid run-up in electricity demand tied to the shale oil/gas boom.
Chaired by Gov. Jack Dalrymple, the three-member Industrial Commission also approved spending $120,000 to have Evergreen, CO-based consultant Bentek Energy LLC analyze North Dakota's future gas production and make suggestions on needed expansions or upgrades to the existing pipeline network.
While oil production has quintupled in the past five years, North Dakota's Department of Mineral Resource (DMR) has estimated that more than 30% of the state's natural gas output is burned off, wasted because pipeline and processing plant development has lagged production growth. The head of the state pipeline authority, Justin Kringstad, indicated Monday that the study should spell out for energy companies what sort of gas transportation network is needed to handle what are expected to be rising volumes of gas during the next 10 years.
The gas study by Bentek is slated to be completed by mid-July. The state is hoping to get a sense of how much production can be expected from each new gas well and how quickly that production will tail off.
"The knowledge that we have in North Dakota right now on our gas is very limited," said Kringstad, as quoted by the Associated Press. "[Gas] is still a very young development."