Since drilling began in the 1950’s, North Dakota has drilled more than 1.3 billion barrels of oil, making it one of the largest producers in the nation. Drillers struck oil on April 4, 1951 and changed the state’s economy forever. Production continued and looked as though they would peak in the early 1980’s until the discovery of horizontal drilling and hydraulic fracturing, also known as “fracking”. This secured North Dakota’s spot among the top oil and gas producers in the country.
Horizontal drilling and fracking began in the Bakken Shale formation, a rich natural oil and gas play. Covering the western region of North Dakota, northeastern Montana and two Canadian Providences, the Bakken Shale is the largest continuous crude oil accumulation in the United States. It is estimated that the Bakken and underlying Three Forks formations combined hold roughly 24 billion barrels of crude oil. The Bakken Shale formation and Three Forks formation have produced more than 300 million barrels of oil to date and are expected to grow in the upcoming years. The North Dakota oil boom not only has resulted in an increase in new jobs, giving the state the lowest unemployment rate in the country, but also means good news for mineral right owners. North Dakota oil and gas mineral right owners have been given a new window of opportunity to profit from their ownership.
Mineral right owners and surface right owners differ in that one may own minerals and not surface; depending upon if the two have been severed. If severed, it is likely that the land and mineral rights are owned by two different parties. Oil and gas mineral rights refer to the ownership of the minerals below the land surface. Historically land was transferred among owners with mineral, or royalty, rights overlapping surface rights; however this process began to change with the production of oil and gas in the U.S. Like other states, North Dakota leases are public record and can be found at the county courthouse in which the property is located.
Production in North Dakota over recent years has been termed as an oil boom. Analysts predict an increase in as much as 80,000 additional barrels of oil a day through 2016, making the Bakken Shale formation a promising region for North Dakota mineral owners as well as potential buyers and sellers.
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