Nearly three years ago, a picture began circulating on the Internet showing a satellite image of the middle of the country. The photograph, taken at night, showed what looked like a sprawling megalopolis glowing in western North Dakota. The lights were flares of natural gas, many of which burn for months or years. The fossil-fuel rich rock formation that energy companies are tapping, known as the Bakken, holds both oil and gas, and there’s no way to extract one without the other. But while oil can be trucked away from a well site, gas requires pipelines and processing plants, and North Dakota has few of either. Because the oil is worth much more than the gas, and because energy companies have been racing to drill before their five-year leases with mineral owners expire, the drillers stand to make more money drilling as fast as they can even if they’re wasting gas they might otherwise sell. The gas they burned off in 2012 was worth about $1 billion, according to a report by Ceres, an advocacy group that pushes for sustainable investing, and released the greenhouse gas equivalent of one million cars. Flares also emit noxious pollutants including benzene, a known carcinogen.
North Dakota addresses flaring in two ways: administrative rules restrict flaring on a field by field basis — generally by limiting production if companies flare for more than 60 days — while state law allows companies to flare for up to a year without paying royalties or taxes. Those limits are much less stringent than in other states — even oil-friendly Texas allows for just 10 days — but the Department of Mineral Resources has issued countless waivers to the rules, Ritter said, allowing companies to continue flaring because they demonstrated that capturing the gas was not economically feasible. Ritter said comparing North Dakota to other states is unfair. For one thing, drillers in North Dakota were looking for oil, not gas, and Texas has many gas fields and, therefore, a large infrastructure prepared to handle extra gas from oil wells. Officials also point to North Dakota’s harsh climate as a limitation, noting that companies can dig for pipelines for barely half the year.
The waste has caused increasing consternation among many people in North Dakota and across the country, though, including Robert Harms, who at first seems like an unlikely candidate for agitator. Harms is the chairman of the North Dakota Republican Party, former general counsel for two Republican governors, and he’s spent years as a lobbyist and consultant for the oil industry. He’s also been an outspoken critic of flaring, which he says has made the western part of the state look “like a freaking huge birthday cake.”
Last year, Harms lobbied the state legislature for the Environmental Defense Fund, a national advocacy group that hadn’t had much presence in the state but wanted to reduce flaring. Harms brings a complex mix of interests to the debate. He had previously worked with companies that wanted to install generators or other equipment at well sites to use the flared gas. He still represents oil field service firms, including some pipeline companies. His family comes from the heart of the oil fields and they own minerals. He said an environmental group is “not something I would typically align myself with.” But where the Environmental Defense Fund sees an environmental problem, Harms sees bad economic policy.
In concert with the Dakota Resource Council, Harms pushed a number of bills last session that would have either shortened the length of time companies could flare or restricted the Department of Mineral Resources’ ability to grant waivers to its rules. But in the end, Harms’ ties to the industry and chairmanship of the state’s governing party didn’t help much.
When Sen. Tim Mathern, a Democrat, introduced a bill to remove the ability for companies to get a waiver from the one-year limit on flaring, Harms and the Dakota Resource Council spoke in favor. Ron Ness, of the Petroleum Council, followed, and told a Senate committee about the difficulties his members faced. Early estimates of the volume of gas proved too low, he said, and while energy companies have been investing billions of dollars in new pipelines, gaining easements and building the infrastructure takes time. He urged the committee instead to consider incentives to encourage capturing the gas. The next day, the committee voted the bill down.
As it turned out, a bill was working its way through the legislature that would do just what Ness had suggested. The House had passed a measure that offered tax cuts for companies finding alternative methods of capturing the gas. When it reached the same Senate committee, Harms convinced lawmakers to adopt an amendment that shortened the allowable time to flare without paying taxes and royalties to six months. But when the two chambers met in a conference committee to work out details, two representatives stood firm against the amendment. Rep. Glen Froseth, a Republican from the same district as Onstad, said the incentives would work and stressed the need “to keep this oil industry going.” (Froseth raised $2,300 from oil interests in 2012, out of a total $8,350.) Eventually, the senators yielded and the amendment failed. The result, in Harm’s words, was “window dressing.”
“The political will just didn’t exist, and I think the industry was resistant to any of those changes,” said Harms, sitting in Peacock Alley, one of Bismarck’s main political watering holes, where lawmakers and lobbyists mingle during the state’s short, biennial legislative session. He was wearing a light brown suit that accentuated his long frame, with a “Reagan Republican” pin in the lapel. “The industry has a fair amount of influence, as you would expect it to. They’ve been here for 60-plus years … I’m a big fan of the oil industry. I represent people in it. My family grew up in it … So the western part of the state is pretty friendly to the oil industry. And you’d expect an industry that’s been here that long to have lots of friends and lots of influence, appropriately. It isn’t universally true, but if the industry opposes a bill, it’s going to have a more difficult time getting passed.”
Even among friends, though, patience is wearing thin on flaring. The towering flames of gas can burn as loud as jet engines. Some residents who live near flares have complained of headaches, nausea and other symptoms. While they’re only one of many sources of emissions, many residents complain of deteriorating air quality across the region.
“We had to check the wind everyday, because you don’t know what was in that stuff,” said Jorgenson, the farmer and rancher near White Earth, who has wells near her home that have flared on and off for years. “It just interferes with the normal things in your life like going for walks, hanging out the laundry. I used to go cross-country skiing, horseback riding. Our horses don’t want to go anywhere near those wells.”
A couple of years back, the health department realized that the models the oil companies had been using to estimate emissions from well drilling and operation had been too low. As a result, thousands of wells had been emitting toxic pollutants like benzene and toluene for years, potentially at levels above the allowable limits. The state worked with oil companies to revamp their models, and has reached consent agreements with 32 companies since the beginning of 2013. The companies agreed to install better equipment to cope with the emissions and to pay a collective total of $2.6 million for the violations.
Glatt, of the Health Department, said his division’s monitoring network has detected a slight increase in particulate pollution in the region, but not to unhealthy levels. The Dakota Resource Council and other critics say that the monitors are too few to notice any problems — only one is located in the heart of the drilling region, and it was put there in 2012. The monitors measure ambient air quality and likely would not reflect more localized problems caused by flares, they say.
Glatt said he understands people’s concerns, but that the state’s monitoring system, set under guidelines from the federal Environmental Protection Agency, continues to show compliance with federal standards. “There’s a lot of wind, and there’s a lot of dispersion out there, so I really don’t think there’s enough [pollution] that it’s changing the air quality.”
Perhaps. But in July, the Industrial Commission announced that it would institute targets for reducing flaring, and would require that companies curtail their oil production if they are not hitting those targets.
The goals, however — cutting flaring to 26 percent of all the gas produced by the end of this year and dropping the limit gradually to no more than 10 percent by 2020 — were set by the industry itself, in a series of recommendations it gave to the commission. Companies also must now submit plans for capturing the gas when they apply to drill a well, another recommendation from the industry.
The rule has met mixed reviews. Notably, the targets are percentage-based, meaning the total volume of flared gas may not drop as quickly as the figures suggest, since production continues to increase. Dan Grossman, regional director of the Environmental Defense Fund’s Rocky Mountain office, was happy to see the commission tie production to statewide flaring targets, a move he said the industry fought. Grossman said the rule is a good start, but that North Dakota still has a long way to go to catch up with other oil and gas producing states. “They’re all below 10 percent,” he said. The federal Bureau of Land Management is also developing rules for wells on federal lands.
In an interview before the rules were announced, Helms, the regulator, defended his department’s approach to flaring, saying that the wells turned out to produce far more gas than anyone expected and that there simply was no feasible way to capture more of it.
“We try really hard not to give the industry any more input into the rulemaking than we give the landowner groups,” Helms said. “I will say that typically, when industry comments on rule making, they have engineers and geologists and lots of technical experts at their disposal, and so their comments are often much more to the point and make a huge difference in terms of what the final rule comes out like.”
Morrison, of the Dakota Resource Council, put it a different way. “How do things work? North Dakota state government says, ‘What should we do?’ And then the industry comes back and tells them how to do it.”
Dan Kalil, 57, wears a broad, Wilford Brimley-style mustache, and is, in his words, “a conservative and a conservationist.” He doesn’t belong to either political party, but he is a longtime county commissioner in Williams County, which includes Williston, the biggest town in the oil fields, and he’s fed up. Early one morning over eggs at the county courthouse cafe, Kalil described a state of constant churning chaos, where drillers do what they want and regulators are unresponsive at best.
“The attitude is, we’re sitting in Bismarck, we don’t care,” he said. “At five o’clock down there, those people clock out and go home …. It’s never over up here. The day is never over, the pressure’s never over, the stress is never over, and the noise is never over.”
Kalil said the state failed the people in the oil fields by allowing the drilling to proceed faster than the region could cope with it, a sentiment shared by many here. But the Mineral Resource Department’s Helms said the state constitution prohibits them from withholding leases purely to control the pace of development, not only to protect oil companies’ right to drill, but also mineral owners’ right to exploit their property.
And there lies the rub. Because mineral rights can be sold separately from the land above them, many here do not own the oil below their farms. In some cases, mineral owners live hundreds of miles away in other states. If they lease their land, there’s nothing a surface owner can do to stop the drilling, even if it wreaks havoc on a treasured way of life for folks like Kalil, whose grandfather came to the area a century ago as part of the homestead movement led by the Northern Pacific Railway.
There’s an old farmstead on Kalil’s property where his son used to take a packed lunch and a BB gun and spend the day catching frogs. Then one day an oil company plopped a well right next to it. “He was just so upset at this intrusion, losing his favorite place,” he said. “We didn’t need the countryside run over. We’ve just been trammeled.” Kalil speaks in low, understated tones, belying any agitation. “I’m upset that the state has allowed the industrialization of western North Dakota. I thought this was paradise. I counted myself so lucky to have been born here. Everything I wanted in life was here. I had no desire to go anywhere else,” said Kalil. “All I wanted to do was farm and ranch, from the time I could stand up. And it’s stolen the future for a lot of people who wanted to retire here, who wanted to live out their days here. It’s stolen mine.”
Data reporter Ben Wieder contributed to this story