Now that the Bakken has hit a slowdown, many people have been left scratching their head, asking “what’s next for the Bakken”? Just one year ago things were moving at a breakneck pace. There were 180 to 190 drilling rigs operating in North Dakota. North Dakota now has a rig count right around 80. With the drop in activity, many people have lost their jobs. Some companies have went out of business, others are still booming.
The price of oil has been the driving force in the last few months. Oil was once at $150 a barrel, now we are struggling to see $60 a barrel. When the oil prices collapsed, so did much of the drilling activity. There are still wells being punched, just at a much slower pace. Oil companies have had to adapt to the prices, to ensure they are operating within budget.
The drilling activity may have slowed down in North Dakota but one area that is still booming is construction. If you take a look around, there are apartments being built at record pace. Throughout the state the amount of new buildings going up is staggering. It almost has a person wondering if they are overbuilding. Will they be able to rent these units out once they are completed? I think the times of $3000 a month rent are coming to an end, not only because people simply can’t afford it any longer but because there will be so many open units, rental companies will eventually get into pricing wars.
Minot has seen an outflux of people over the last few months. The traffic has slowed down a bit. Before the highways were inundated with semis moving non stop. Now you look around and you just don’t see the traffic we once had. This can be spun into a positive. It’s taking stress off the roadways, giving people time to get caught up with roadway projects and various other construction projects.
The boom may be over, but the Bakken is going to be here for decades. We are about 13,000 wells into an estimated 70,000 wells needed to get all the oil out of the Bakken. Oil companies have moved into more pad drilling. Rather than punching a well and moving the rig to a whole new location, they are drilling multiple wells on one pad.
If the oil prices take a huge jump and hold steady, the Bakken will be back to a crazy pace almost overnight. Rigs will be sent out, workers will be needed, all will be back to a controlled chaos.