MDU Resources Group, Inc. and Calumet Specialty Products Partners, L.P. announced that they have formed a joint venture to develop, build and operate a diesel refinery in southwestern North Dakota. The joint venture will be called Dakota Prairie Refining, LLC.
MDU Resources Group's participation in the joint venture will be through its wholly owned subsidiary, WBI Energy, Inc.
A few days ago, the government reported the stunning news the U.S. economy actually contracted by .1 percent in the fourth quarter of 2012. The Washington Post sent a news bulletin shortly thereafter that blamed the problem on "cuts in government spending, fewer exports and sluggish growth in company stockpiles."
John Berlau, Senior Fellow in Finance and Access to Capital at the Competitive Enterprise Institute, had the following to say in reaction:
While the housing market in Montana has improved since the end of the recession, "overall credit remains tight, and many potential Montana buyers cannot secure a mortgage based upon credit score or household debt," said Scott Rickard, Director, speaking to the attendees of the Economic Outlook Seminar in Billings. And, for Montana, the situation is better than in many other parts of the country, because on average credit scores tend to be higher in Montana.
A Bureau of Land Management (BLM) oil and gas lease auction netted $11,433,090 in revenues from the sale of 25 Federal leases, totaling 2,831.38 acres, in North Dakota. The quarterly sale took place at the BLM's Montana State Office in Billings.
The highest single-parcel bid was $1,596,000 submitted by Slawson Exploration Company, Inc. of Wichita, Kan., for an 80-acre parcel located in Mountrail County.
The next BLM Federal oil and gas lease sale is scheduled for May 7, 2013, at the BLM's Montana State Office, located at 5001 Southgate Drive, Billings. Additional information is available by writing the Bureau of Land Management, 5001 Southgate Dr., Billings, Mont. 59101, by calling (406) 896-5004, or at www.blm.gov/mt.
Agriculture in Montana has had a good run for a while now, despite drought, recessions, politics and volatile markets. For the most part 2013 is projected to be as good, if not better, in Montana, as was 2012.
Montana has not been as hard hit by the drought as have areas to the south. And, in fact, because drought induced shortages have pushed up market prices, Montana ag producers end up being net beneficiaries of the drought – and of floods. Floods last year in North Dakota which impacted ag production pushed up demand for production from Montana.
The second phase of a comprehensive new study co-sponsored by the U.S. Chamber's Institute for 21st Century Energy was released, highlighting the benefits that shale energy will have on Montana's economy over the coming years. IHS, a leading global energy research firm, is conducting the three part study to examine the economic impact of shale energy exploration and production across the country. Part one of the report, which focused on the national benefits, was released last month.
According to the study, shale energy production has already created more than 9,600 direct, indirect and induced jobs in Montana and is projected to support 16,700 jobs by 2020. In addition, shale energy development will generate $360 million in state and local government revenue in 2012 alone, and from 2012-2035 could generate $15.6 billion in state and local government revenue.
"Shale energy is a game-changer for America and for Montana," said Karen Harbert, president and CEO of the Energy Institute. "The latest installment of this study allows us to quantify just how significant the impact on both state and the national economy will be. It provides all the more reason to strongly support responsible shale energy development."
Nationally, the IHS study shows that by 2015, shale and unconventional energy will be responsible for 2.5 million jobs; by 2020, 3 million, and by 2035, 3.5 million. In 2012, shale energy is responsible for $62 billion in government revenue. Between now and 2035, shale energy development is expected to contribute more than $2.5 trillion in total government revenue—about half of which goes to the federal government. Overall, between now and 2035, the energy industry will invest more than $5.1 trillion in energy development in the United States.
"Our analysis indicates that both oil and gas producing and non-producing states alike are reaping the benefits of the unconventional oil and gas revolution," the report says. "Some states benefit through firms that participate in upstream exploration and production, while other states benefit through firms that comprise the vast supply chain supporting unconventional oil and gas development, or both. States also benefit from the interstate trade that occurs as the unconventional oil and gas income effect flows through the economy."
The IHS study released recently is the second in a three-part series designed to shed light on the economic impact of shale. This state-specific study, as well as part one, focused exclusively on the impact of operations surrounding the extraction of oil and gas (referred to as "upstream" operations). The final installment—to come in early 2013—will examine the entire economic impact of shale, including components like manufacturing and chemicals (known as "downstream" operations).
The U.S. Chamber's Energy Institute partnered with the American Petroleum Institute, American Chemistry Council, America's Natural Gas Alliance and Natural Gas Supply Association to sponsor the study.
The mission of the U.S. Chamber of Commerce's Institute for 21st Century Energy is to unify policymakers, regulators, business leaders, and the American public behind a common sense energy strategy to help keep America secure, prosperous, and clean. Through policy development, education, and advocacy, the Institute is building support for meaningful action at the local, state, national, and international levels.
The U.S. Chamber of Commerce is the world's largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations.
Activity in the huge Bakken field is going home.
Home is Montana, where the Bakken was originally discovered.
Drilling equipment and crews are moving back across the border from North Dakota—where the Bakken Boom has been the Biggest—boosting Montana's rig count to 22 from just eight at this time last year. Montana's Department of Natural Resources and Conservation issued a record 356 oil drilling permits in the first ten months of the year, easily beating the previous record of 313 set in 2005.
In October a Texas company paid $13.5 million for 75,000 acres of oil and gas leases, one of the largest federal lease acquisitions by a single company in Montana in recent years. Several other companies, including Bakken leader Continental, are working to expand the boundaries of the state's most productive Bakken field, known as Elm Coulee.
While the housing market in Billings is regaining some of its past momentum, it is still off from its peak, according to Billings real estate broker, Howard Sumner, who keeps close track of the numbers.
"Closed transactions are 18 percent higher than a year ago," said Sumner, "And, our inventory is ending about 23 percent lower, and pending sales are sitting at the end of the year, up at 24 percent of where they were a year ago, which means we will have more pending sales going into the year."
The Big Sky Business Journal
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