2017 ANNUAL REPORT
www.energynd.com 1 table of CONTENTS LETTER FROM THE DIRECTOR...... 3 ENERGY SITES OF NORTH DAKOTA...... 4 A VIEW FROM ABOVE...... 4 NORTH DAKOTA GENERATION...... 5
GENERATION...... 6 Coal-Based...... 6 Mining...... 7 Reclamation...... 8 Peaking Plants...... 9 Wind...... 10 Geothermal...... 14 Hydro...... 14 Solar...... 14 Recovered Energy...... 16 Transmission and Distribution...... 17
PETROLEUM...... 19 Oil and Gas Production...... 19 Shale Energy Technology...... 21 Refining...... 22 Pipelines...... 23 Synthetic Natural Gas...... 25 Natural Gas Processing...... 26 Petroleum Marketing / Propane...... 28
BIOFUELS...... 28 Ethanol...... 28 Biomass / Biodiesel...... 30
ENERGY RESEARCH...... 30 ENERGY EFFICIENCY...... 32 NORTH DAKOTA TAXES...... 33 NORTH DAKOTA JOBS...... 33 EDUCATION/WORKFORCE TRAINING...... 34
The Great Plains Energy Corridor, housed at Bismarck State College’s National Energy Center of Excellence, works with partners in government, education, and the private sector to promote and enhance North Dakota’s energy development. Together we provide information, education, outreach programs and special events on a wide range of energy topics. www.energyND.com
2 Spotlight on North Dakota Energy from the DIRECTOR Thank you for picking up the } State legislators approved 2017 edition of the Great Plains creation of the North Dakota Energy Corridor’s Spotlight on Department of Environmental North Dakota Energy! This report Quality during the 2017 session. is a statistical overview of all While the function of this forms of energy in North Dakota department has always been with for the year 2017 – updated the state Department of Health, annually and usually distributed it acknowledges the importance at the end of the first quarter of of environmental protection the following year. in the state by elevating the responsibility to a cabinet level Here’s a quick look at some of position. the highlights from 2017: } A major transmission line } Federal tax credits continue to serving an increasing demand boost wind energy development for electricity in northwest North in North Dakota. In 2017, the Dakota due to oil development North Dakota Public Service was placed in service in late Commission received requests to 2017. add 450 MW of wind power to the grid. } In recent years, charging stations for electric vehicles have } A major advancement for coal been installed at locations across development took place in 2017 North Dakota. as a new project to produce urea Emily Cash was placed in operation at the I would like to thank Daryl Hill, Emily Cash Great Plains Synfuels Plant near who assisted with gathering Director, Beulah. the information you find in Great Plains Energy Corridor this document. Together, with Bismarck State College } Coal production in the state our industry partners and topped more than 29 million the EmPower North Dakota tons, surpassing a level last Commission, we are able to achieved in 2009. Efforts to provide up-to-date information reduce costs and higher demand for this year’s report. were cited as reasons for the increase. Thank you for your continued readership!
North Dakota is one of the only states with a multi-resource energy policy, guided by the EmPower North Dakota Commission. Through the EmPower North Dakota Commission, leaders from all major energy industries in North Dakota meet with one common goal: to be critical thinkers for the development of the state’s energy resources. www.EmPowerND.com
www.energynd.com 3 energy sites of NORTH DAKOTA
Minot Williston
Grand Forks
Dickinson
Bismarck Fargo
Natural Gas Processing Coal-Based Generation Lignite Mine Hydro Power
Wind Farm Synfuels Plant Ethanol Plant Petroleum Refinery
Recovered Energy Solar Farm Biodiesel Plant Peaking Station Generation
Bakken Formation Oil Fields
+ Map courtesy of Bismarck State College National Energy Center of Excellence.
A View From Above North Dakota Total Energy Production According to the U.S. Energy Information Administration, North CrudeCrude Oil Oil Dakota ranks sixth in the nation NaturalNatural Gas Gas for total energy production – a CoalCoal total of 3,655 trillion BTU. The RenewablesRenewables state ranks fourth in the country for total energy consumption per capita at 803 million BTU. Source: Current data from U.S. Energy Information Administration, State Profile and Energy Estimates
4 Spotlight on North Dakota Energy
north dakota
GENERATION } North Dakota produces North Dakota Electricity Production electricity from a wide variety of sources, including coal-fired baseload power plants, the Coal-Fired hydroelectric turbines at Garrison Wind Dam, a growing statewide Hydro network of wind turbines, Natural Gas-Fired natural gas and fuel oil peaking plants, heat recovery units that capture waste heat from pipeline Sources: Current data from U.S. compressor stations, and even Energy Information Administration, a small amount of solar power. North Dakota State Energy Profile There is also work being done Coal-Fired to explore the potential of Wind geothermal generation in western North Dakota. Hydro Natural Gas-Fired } According to the U.S. Energy } Even though demand for Information Administration, North electricity rapidly increased in ABBREVIATIONS: recent years, primarily driven Dakota had the fifth lowest- BTU - British Thermal Unit by the oil and gas production cost electricity for residential kV - Kilovolt industry in western North Dakota, use in 2017. As of year-to-date kW - Kilowatt almost 60 percent of the state’s December 2017, the average kWh - Kilowatt-hour total electricity supply is provided residential electricity price in MW - Megawatt to the interstate electricity trade. North Dakota was 10.40 cents/ MWh - Megawatt-hour kWh, compared to the national average of 12.90 cents/kWh.
Residential Electricity Rates
Cents per kWh 10.99 11-11.99 12-14.99 14-16.99 17
+ North Dakota has some of the lowest electricity prices in the nation. The map above was created by Bismarck State College National Energy Center of Excellence using data from the U.S. Energy Information Administration.
www.energynd.com 5 GENERATION + Coyote Station, located near Beulah, came online in 1981 and employs around 80 people. The plant is owned by Otter Tail Power Company, Northern Municipal Power Agency, Montana-Dakota Utilities Co., and NorthWestern Energy. Photo courtesy of Otter Tail Power Company.
COAL-BASED
} One megawatt-hour (MWh) is } North Dakota is currently one } Lignite industry companies enough electricity to serve more of only 15 states that meets all of (power plants and coal mines) than 800 homes with an hour’s the U.S. Environmental Protection have contributed more than $100 worth of power. Agency’s federal ambient air million through total annual quality standards. taxes in 2017, including sales, } North Dakota’s power plants personal, and corporate income have invested around $1 billion } The lignite industry employs taxes. in new technology since 2006 to 3,942 workers directly and reduce emissions and increase another 11,540 indirect workers. efficiencies. These investments account for 20 to 30 percent of a power plant’s costs.
Plant Operating Company Capacity by MW Coal Creek Station Great River Energy 1,146 Antelope Valley Station Basin Electric Power Cooperative 900 Milton R. Young Station Minnkota Power Cooperative 705 Leland Olds Station Basin Electric Power Cooperative 669 Coyote Station Otter Tail Power Company 427 Heskett Station Montana-Dakota Utilities Co. 100 Spiritwood Station* Great River Energy 99 Total 4,046
* Spiritwood Station is a combined heat and power plant. Its primary product is steam, which is sold to users at the Spiritwood Energy Park near Jamestown. The plant also produces some electricity for the regional grid.
6 Spotlight on North Dakota Energy + Mining companies must reclaim mined land back to its original use and production, including wetlands. The area shown above was re-established at the Freedom Mine following the mining process. Photo courtesy of The Coteau Properties Company.
MINING
} North Dakota has the second-largest known } North Dakota lignite mines produced a record reserves of lignite in the world (behind only 29.1 million tons in 2017, the highest annual Australia) with an estimated 25 billion tons of tonnage since 2009 and 1.4 million tons more than recoverable resources. It is estimated that the state’s the 2016 total. Nearly 80 percent of lignite is used reserves would last more than 800 years at the to generate electricity, 13 percent is used to make current rate of consumption. synthetic natural gas, and 7 percent is used to produce fertilizer and other products.
Annual Owner/ Mine Location Facilities Served Production Operator Antelope Valley Station and Great Plains The Coteau 8 miles northwest Freedom Mine 14.7 million tons Synfuels Plant, Beulah; Properties of Beulah and Leland Olds Company* Station, Stanton Dakota 5 miles southwest Beulah Mine 500,000 tons Heskett Station, Mandan Westmoreland of Beulah Corporation 4 miles southeast Milton R. Young Station, Center Mine 4.5 million tons BNI Coal Ltd. of Center Center Coal Creek Station, Falkirk Mining Falkirk Mine 7.5 million tons Underwood Underwood; Spiritwood Company* Station, Spiritwood
Coyote Creek 5 miles south of Coyote Creek 2.5 million tons Coyote Station, Beulah Mine Beulah Mining Company*
*Owned by North American Coal Corporation
www.energynd.com 7 MINING
} There are also two Leonardite mines in North Dakota – the American Colloid Mine near Scranton and the Leonardite Products Mine near Williston. Leonardite is a highly oxidized form of lignite that is used as a soil amendment and by the oil industry as a drilling additive. Both mines have a processing plant associated with them.
} Lignite coal and commercial leonardite are taxed at a flat rate of 37.5 cents per ton by the state of North Dakota. An additional 2-cent per ton tax is levied for the Lignite Research Fund.
} More than $1 billion in tax revenue has gone to the state of North Dakota since 1975 from the lignite severance and coal conversion taxes.
+ Location of coal deposits around the United States. Map courtesy of Lignite Energy Council.
RECLAMATION
} North Dakota lignite mines practice } The Falkirk Mine was the nation’s first surface contemporaneous reclamation, which means coal mine to operate a survey drone for simultaneously mining and reclaiming land. reclamation. Pre-mining surveys are used to plan for water management and to determine elevation } Mining companies typically have three years to and placement of topsoil and subsoil. Drones reclaim mined land by grading and respreading the provide an innovative way to retrieve topographical soil and seeding the land. After that, mines keep maps of large areas. Time is saved in the field reclaimed land under performance bond for at least because the drone surveys around 400 acres per ten years to prove reclaimed land produces crops 50-minute flight. The data is downloaded to a or forages as good as or better than before mining. computer and can be interpreted in a few hours.
} Between 1,500 and 2,000 acres of land are Source: Lignite Energy Council, Great River Energy, Basin disturbed by coal mining and reclaimed each year. Electric Power Cooperative, MDU Resources Group, Inc., Mining companies spend an average of $30,000 to Otter Tail Power Company, Minnkota Power Cooperative, U.S. Environmental Protection Agency, Falkirk Mining Company reclaim one acre of land, but costs can be as high as $60,000 an acre in some instances.
} More than 27,000 acres of permitted land in the state have gone through final bond release – the equivalent of around 40 square miles.
8 Spotlight on North Dakota Energy GENERATION + Basin Electric’s Lonesome Creek Station, near Watford City, started commercial operation in 2013. After two additional units came online in 2017, the total output is now 225 MW. Photo courtesy of Basin Electric Power Cooperative.
PEAKING PLANTS
} Peaking plants provide power } Basin Electric Power } Montana-Dakota Utilities has generation companies with rapid Cooperative, Bismarck, operates an 88 MW natural gas-fired unit, response to regional “peaks” to two natural gas-fired peaking Heskett 3, located next to its meet the demand for electricity. stations to help provide electrical coal-based Heskett Station near The additional generating stability in western North Dakota. Mandan. The unit uses a General capacity that these smaller Electric 7EA combustion turbine. facilities provide can be used in § Lonesome Creek Station, extreme weather conditions when located west of Watford City, } Otter Tail Power Company has demand for electricity exceeds the has five 45 MW units, for a two fuel oil combustion turbines capacity of baseload facilities. total capacity of 225 MW. in Jamestown that have a total They are also used to provide capacity of 41.5 MW. § Pioneer Generation Station power when other resources is located northwest of are not available. They can be Sources: Basin Electric Power Williston. Basin Electric powered up from stand-by status Cooperative, MDU Resources Group, recently finished Phase III of Inc., Otter Tail Power Company to full load very quickly and, in Pioneer Generation Station, most cases, are operated from bringing the station’s total a remote site. In North Dakota, generating capacity to the peaking plants are fueled by 247 MW. either natural gas or fuel oil. § Both Lonesome Creek and Pioneer Generation Stations employ General Electric LM 6000 combustion turbine generators. Phase III of the Pioneer Generation Station site generates electricity using reciprocating engines.
www.energynd.com 9 GENERATION + Lucas Montag, a student in Bismarck State College’s (BSC) Energy Services & Renewable Technician program, stands on the BSC nacelle trainer. A nacelle houses the generating components in a wind turbine. The trainer is used to teach safe climbing and rappelling procedures to students and industry members. Photo courtesy of Bismarck State College National Energy Center of Excellence.
WIND
} North Dakota has almost 3,000 } North Dakota ranks 11th for } ALLETE Clean Energy MW of wind energy capacity installed wind capacity, getting announced in 2017 that it would installed throughout the state, 22 percent of its net electricity be expanding the Thunder Spirit consisting of more than 1,500 generation from wind resources. Wind project by 48 MW with wind turbines. anticipated completion in 2018. } The federal wind energy In 2015, ALLETE Clean Energy } In per-capita terms, North Production Tax Credit (PTC) completed and sold the 107.5 Dakota has the highest wind provides wind developers a MW Thunder Spirit Wind project installed electricity capacity, credit of 2.3 cents per kilowatt- to Montana-Dakota Utilities. The according to the National hour (kWh) for the production expansion is planned to be sold Renewable Laboratory’s 2016 of electricity from utility-scale to Montana-Dakota as well. Renewable Energy Data Book. turbines during the project’s first ten years of operation. The PTC } While the national wind will be phased down in future capacity factor averaged 34.5 years at 80 percent of its present percent in 2016, North Dakota value in 2017, 60 percent in wind farms typically see higher 2018, and 40 percent in 2019, rates between 40 – 50 percent. then it goes to zero. As before, the law allows wind projects to qualify for the PTC in the year that they start construction.
10 Spotlight on North Dakota Energy } ALLETE Clean Energy is constructing a 100-MW wind CAPACITY FACTOR: farm in Morton and Mercer Capacity factor is the actual electricity output of a power counties that is expected to be generating facility, divided by the maximum output it could completed in 2019. Electricity provide if it ran at full output 100 percent of the time for a produced from the Clean Energy full year. In other words, if the capacity factor of a wind farm 1 wind farm will be supplied averages 38 percent, that means the total generating capacity of to Xcel Energy under a power that wind farm is available 38 percent of the time on average. purchase agreement.
Sources: North Dakota Public Service Commission, NextEra Energy, Minnesota Power, Acciona Wind Energy, Iberdrola Renewables, MDU Resources Group, Inc., Basin Electric Power Cooperative, Minnkota Power Cooperative, American Wind Energy Association, U.S. National Renewable Energy Laboratory, Wind Powering America, U.S. Energy Information Administration
US Installed Wind Capacity 2017
Installed Wind Capacity 10,000 MW 5,001-10,000 MW 1,001-5,000 MW 101-1,000 MW 0-100 MW
+ Map created by Bismarck State College National Energy Center of Excellence using data from the American Wind Energy Association, current through the fourth quarter of 2017.
www.energynd.com 11 Capacity Wind Facility County Owner Company Power Purchaser ** (by MW) Ashtabula Wind Energy Center I (2008) Barnes NextEra Energy Minnkota Power 148.5 Great River Energy (51 MW), Ashtabula Wind Energy Center II (2009) Griggs, Steele NextEra Energy 120 Minnkota Power (69 MW) Ashtabula Wind Energy Center III (2010) Barnes NextEra Energy Otter Tail Power Company 62.4 Ashtabula Wind Farm (2008) Barnes Otter Tail Power Company 48 Baldwin Wind Energy Center (2010) Burleigh NextEra Energy Basin Electric Power Cooperative 102.4 Bison Wind Energy Center 1 (2011, 81.8 MW) Bison 2 and 3 (2012, 210 MW) Oliver, Morton Minnesota Power 496.6 Bison 4 (2014, 204.8 MW) Border Winds Project (2015) Rolette Xcel Energy 150 Brady Wind I Energy Center (2016, 150 MW) Stark, Hettinger NextEra Energy Basin Electric Power Cooperative 300 Brady Wind II Energy Center (2016, 150 MW) Cedar Hills Wind Farm (2010) Bowman Montana-Dakota Utilities Co. 19.5 Courtenay Wind Project (2016) Barnes Xcel Energy 200.5 Langdon Wind Energy Center (2007) Cavalier Otter Tail Power Company 40.5 Minnkota Power Cooperative (139.5 MW), Langdon Wind Energy Center I (2007, 118.5 MW); Langdon II (2009, 40.5 MW) Cavalier NextEra Energy 159 Otter Tail Power Company (19.5 MW) Lindahl Wind Project (2017) Williams Tradewind Energy Basin Electric Power Cooperative 150 Luverne Wind Farm (2009) Steele Otter Tail Power Company 49.5 Basin Electric Power Cooperative (40 MW), North Dakota Wind Energy Center – Edgeley (2003) LaMoure NextEra Energy 61 Otter Tail Power Company (21 MW) Oliver Wind Energy Center I (2006, 50.6 MW); Oliver NextEra Energy Minnesota Power 98.6 Oliver II (2007, 48 MW) Oliver Wind III Project (2016-2017) Oliver, Morton NextEra Energy Minnkota Power Cooperative 100 Petersburg Wind Project (Infinity Wind Energy) (2002) Nelson Minnkota Power Cooperative 0.9 PrairieWinds 1 (2009) Ward Basin Electric Power Cooperative 122 Rugby Wind Power Project (2009) Pierce Iberdrola Renewables 149.1 Sunflower Wind Project (2016) Morton SunEdison, Inc. Basin Electric Power Cooperative 104 Tatanka Wind Farm* Dickey, McIntosh Acciona Wind Energy Midwest Independent System Operator (MISO) 90 Thunder Spirit Wind (2015) Adams Montana-Dakota Utilities Co. 107.5 Valley City Wind Project (Infinity Wind Energy) (2002) Barnes Minnkota Power Cooperative 0.9 Velva Wind Farm (2005) McHenry Acciona Wind Energy Xcel Energy 12 Wilton Wind Energy Center I (2006, 49.5 MW); Burleigh NextEra Energy Basin Electric Power Cooperative 99 Wilton II (2009, 49.5 MW) Statewide demonstration and privately owned projects N/A Approx. 3
Total 2,994.9
12 Spotlight on North Dakota Energy Capacity Wind Facility County Owner Company Power Purchaser ** (by MW) Ashtabula Wind Energy Center I (2008) Barnes NextEra Energy Minnkota Power 148.5 Great River Energy (51 MW), Ashtabula Wind Energy Center II (2009) Griggs, Steele NextEra Energy 120 Minnkota Power (69 MW) Ashtabula Wind Energy Center III (2010) Barnes NextEra Energy Otter Tail Power Company 62.4 Ashtabula Wind Farm (2008) Barnes Otter Tail Power Company 48 Baldwin Wind Energy Center (2010) Burleigh NextEra Energy Basin Electric Power Cooperative 102.4 Bison Wind Energy Center 1 (2011, 81.8 MW) Bison 2 and 3 (2012, 210 MW) Oliver, Morton Minnesota Power 496.6 Bison 4 (2014, 204.8 MW) Border Winds Project (2015) Rolette Xcel Energy 150 Brady Wind I Energy Center (2016, 150 MW) Stark, Hettinger NextEra Energy Basin Electric Power Cooperative 300 Brady Wind II Energy Center (2016, 150 MW) Cedar Hills Wind Farm (2010) Bowman Montana-Dakota Utilities Co. 19.5 Courtenay Wind Project (2016) Barnes Xcel Energy 200.5 Langdon Wind Energy Center (2007) Cavalier Otter Tail Power Company 40.5 Minnkota Power Cooperative (139.5 MW), Langdon Wind Energy Center I (2007, 118.5 MW); Langdon II (2009, 40.5 MW) Cavalier NextEra Energy 159 Otter Tail Power Company (19.5 MW) Lindahl Wind Project (2017) Williams Tradewind Energy Basin Electric Power Cooperative 150 Luverne Wind Farm (2009) Steele Otter Tail Power Company 49.5 Basin Electric Power Cooperative (40 MW), North Dakota Wind Energy Center – Edgeley (2003) LaMoure NextEra Energy 61 Otter Tail Power Company (21 MW) Oliver Wind Energy Center I (2006, 50.6 MW); Oliver NextEra Energy Minnesota Power 98.6 Oliver II (2007, 48 MW) Oliver Wind III Project (2016-2017) Oliver, Morton NextEra Energy Minnkota Power Cooperative 100 Petersburg Wind Project (Infinity Wind Energy) (2002) Nelson Minnkota Power Cooperative 0.9 PrairieWinds 1 (2009) Ward Basin Electric Power Cooperative 122 Rugby Wind Power Project (2009) Pierce Iberdrola Renewables 149.1 Sunflower Wind Project (2016) Morton SunEdison, Inc. Basin Electric Power Cooperative 104 Tatanka Wind Farm* Dickey, McIntosh Acciona Wind Energy Midwest Independent System Operator (MISO) 90 Thunder Spirit Wind (2015) Adams Montana-Dakota Utilities Co. 107.5 Valley City Wind Project (Infinity Wind Energy) (2002) Barnes Minnkota Power Cooperative 0.9 Velva Wind Farm (2005) McHenry Acciona Wind Energy Xcel Energy 12 Wilton Wind Energy Center I (2006, 49.5 MW); Burleigh NextEra Energy Basin Electric Power Cooperative 99 Wilton II (2009, 49.5 MW) Statewide demonstration and privately owned projects N/A Approx. 3
Total 2,994.9
*Tatanka Wind Farm straddles the North Dakota/South Dakota border with turbines across two counties in N.D. and one county in S.D. The wind farm is 180 MW total with 90 MW in North Dakota.
**If other than project owner.
www.energynd.com 13 GEOTHERMAL
} According to the National } The University of North Dakota Sources: National Renewable Energy Renewable Energy Laboratory, Petroleum Research Center Laboratory, University of North Dakota Department of Geology and Geological western North Dakota has continues to study the feasibility of Engineering favorable locations for deep using oil well sites in the Bakken enhanced geothermal systems to generate up to 300 MW of (EGS). EGS is a technology that electricity using geothermal uses heat from the earth to turn energy. water into steam, which drives a turbine generator to produce electricity.
HYDRO
} The only producer of } The electricity from Garrison of Minnesota, Iowa, Montana, hydroelectric power in North Dam is marketed by the Western South Dakota and Nebraska. Dakota is the Garrison Dam, Area Power Administration. The Western Area Power run by the U.S. Army Corps of Customers in North Dakota Administration is one of four Engineers – Omaha District. It include municipal utilities, power-marketing administrations has been operating since 1955. Native American tribes, state within the U.S. Department of agencies, the two Air Force Energy whose role is to market } The Garrison Dam has five bases, educational institutions, and transmit electricity from turbines with maximum combined irrigation districts and rural multi-use water projects. power output of 583 MW. water entities, and electric power cooperatives. Much of } Over the past ten years, the Sources: U.S. Army Corps of Engineers, the electrical power generated Western Area Power Administration dam has produced an average at Garrison Dam is marketed to of 1.97 million MWh of electricity customers outside North Dakota, annually. including customers in the states
SOLAR
} Solar energy technology is } Bismarck State College has an } Verendrye Electric Cooperative, based on two main types – 8-kW PV solar array on campus Velva, has the largest solar photovoltaics (PV), which is the composed of both crystalline program in the state with more most common way of producing and thin panel solar systems so than 270 solar-powered water solar electricity in North Dakota, students have the opportunity to pumps throughout its service and concentrated solar power study both. territory, including 18 systems (CSP). CSP typically uses mirrors installed in 2017. The pumps are to concentrate the sun’s rays and primarily used in pasture wells create heat that, in turn, drives a in remote areas where building heat or steam engine. PV power power lines is cost prohibitive. uses the sun’s rays to create direct current electricity.
14 Spotlight on North Dakota Energy Annual Solar Output (kWh) 1 000
1 000
12 000
10 000
000
000
000
2 000
0 A A O N GENERATION + Prairie Sun Community Solar produced 138,095 kWh in 2017, which would give it a capacity factor of 15.7 percent. The average member that had one panel would have received a credit of about $39 from the energy produced. The 2017 output represents .01 percent of Cass County’s electric sales. Graph created by Bismarck State College National Energy Center of Excellence using Prairie Sun Community Solar data.
SOLAR
} Cass County Electric } Whiting Petroleum uses PV in Cooperative in Fargo installed North Dakota for some systems a 102-kW solar array in 2016, in the petroleum extraction called Prairie Sun Community process, like automation controls, Solar. It is the first community programmable logic controllers, solar project in the state and flare ignitors, and combustor consists of 324 solar panels controls. These systems allow an located on land owned by the city operator to start up, monitor, and of Fargo. The 2017 output was shut down operations as needed. 138,095 kWh, which was about 7.5 percent below the predicted Sources: National Renewable Energy output using modeling tools Laboratory, Verendrye Electric from the National Renewable Cooperative, Bismarck State College, Cass County Electric Cooperative, Energy Laboratory, due to some Minnkota Power Cooperative, Whiting technical glitches and equipment Petroleum malfunctions.
} Northern Plains and Dakota Valley Electric Cooperatives + Photo above shows Northern installed a 16-panel solar system Plains and Dakota Valley Electric at Northern Plains’ Carrington Cooperatives’ demonstration office in 2015. The total rated solar array. Total output is rated output is 6.56 kW, and the at 6.56 kW. Photo courtesy cooperatives monitor real time of Northern Plains Electric data from the system as a Cooperative. demonstration of what might be used on a small farm, residence, or business. The solar project operated as expected in 2017, saving 8,675 kWh of energy.
www.energynd.com 15 RECOVERED ENERGY
} Recovered energy generation } The sites produce electricity } A subsidiary of Ormat (REG), also known as heat- using exhaust from compressor Technologies developed the recovery generation or waste heat stations on the Northern recovered energy generation. energy, is a process of capturing Border Pipeline. The Northern This is the first use of this the heat from hot exhaust to drive Border Pipeline is a natural gas technology on a natural gas a turbine and create electricity. transportation system of 1,398 pipeline in the United States. miles that links the Midwest with } There are four REG sites in reserves in Canada. Sources: Basin Electric Power North Dakota. Basin Electric Cooperative, MDU Resources Group, Inc. Power Cooperative purchases the electricity from three sites near Manning, St. Anthony, and Zeeland (5.5 MW each); and Montana-Dakota Utilities owns one site near Glen Ullin (5.3 MW).
Minot Williston
Grand Forks
Minot Williston
Grand Forks
Dickinson Bismarck Fargo
Dickinson Bismarck Fargo
RecoveredRecovered EnergyEnergy Generation Generation Northern Border Pipeline Northern Border Pipeline + Map courtesy of Bismarck State College National Energy Center of Excellence.
16 Spotlight on North Dakota Energy GENERATION + Basin Electric Power Cooperative energized 230 miles of 345-kV transmission line and several substations in northwest North Dakota in 2017. Shown in the photo above is a stretch of the new transmission line. Photo courtesy of Basin Electric Power Cooperative.
TRANSMISSION & DISTRIBUTION
} The North Dakota Transmission } Otter Tail Power Company } In September 2017, CapX2020 Authority was established by and Montana-Dakota Utilities utilities energized the Big Stone the state legislature in 2005 to Co. are jointly constructing the South to Brookings County facilitate, finance, develop and Big Stone South to Ellendale transmission line. CapX2020 is acquire transmission in North Transmission Line. Construction a group of 11 Midwest-based Dakota to accommodate new on this 163-mile project kicked utilities that constructed more energy development. off in September 2016. When than 700 miles of 230-kV and complete, this 345-kV line will 345-kV transmission line as } Two major 345-kV transmission connect the new Big Stone part of the largest electric grid lines were energized in 2017 by South Substation near Big Stone expansion to touch the region Basin Electric Power Cooperative, City, S.D., to the new Ellendale in decades. The combined Bismarck. The first line stretches Substation near Ellendale. effort represents an investment 200 miles from the Antelope Construction is set to be complete of nearly $2 billion to ensure Valley Station near Beulah to late in 2018. continued reliable, affordable substations near Grassy Butte electric service to Minnesota, and Williston, and end near Wisconsin, and the surrounding Tioga. In addition, another 30 region while expanding access to miles of 345-kV transmission renewable energy. line, and three new 345/115- kV substations were energized in the Killdeer area. These new line additions will help meet increasing regional electric demand and improve the reliability of the existing system, strengthening the electric infrastructure throughout the region.
www.energynd.com 17 TRANSMISSION & DISTRIBUTION
+ Bismarck State College Lineworker Class of 2017. Students’ training includes classroom study, climbing techniques, and electrical distribution work as well as truck driving and equipment operations. Photo courtesy of Bismarck State College National Energy Center of Excellence.
} Xcel Energy partnered in early test flights in North Dakota } Transmission costs vary 2017 with the Federal Aviation using drones. Research will be depending on voltage, terrain Administration to further study conducted for 18-24 months and type, right-of-way costs, and safe operation of unmanned include inspection of more than many other factors. Average aircraft system (drone) technology 20,000 miles of transmission transmission costs for a new to inspect transmission lines for lines in Texas, Minnesota, South 345-kV line can be $1 – $2 damage. Xcel Energy has been Dakota and North Dakota. million per mile. working the past few years with the University of North Dakota Sources: North Dakota Transmission and other partners to conduct Authority, Otter Tail Power Company, MDU Resources Group, Inc., ALLETE Clean Energy, Minnkota Power Cooperative, Basin Electric Power Cooperative
18 Spotlight on North Dakota Energy PETROLEUM + An oil rig is stationed in western North Dakota’s Bakken Formation. Photo courtesy of Whiting Petroleum.
OIL & GAS PRODUCTION
North Dakota’s oil and gas } Preliminary figures for today, and are able to drill more industry has been significantly December 2017 indicated oil wells faster. Each rig can drill impacted by the combination of production of 36,620,883 about 18 wells a year compared over-production and burgeoning barrels or 1,181,319 barrels/ to just nine in 2009. More than supplies, at a time of reduced day with gas production reaching 98 percent of drilling takes place demand worldwide. According 64,527,191 thousand cubic feet in the Bakken and Three Forks to the U.S. Energy Information or 2,081,522 MCF/day. Formations. Administration, the price of sweet crude oil fell to $39.26 a barrel } While oil production leveled } As of December 2017, in February 2016, as compared off in 2016, gas production preliminary figures indicated to the all-time high price in July continued to rise. This was due to there were 14,293 producing 2008 of $133.48 per barrel. companies concentrating drilling wells, with 86 percent of those in Prices in the last half of 2017 rigs in the most productive and the Bakken Formation. have ranged from $44 – $59 a “gassier” parts of the Bakken } Leasing activity for new drilling barrel. Despite this, increased Formation. sites continues to be very low in efficiencies and technology } December 2014 was the North Dakota, consisting mostly have enabled operators to all-time high in oil production of renewals and top leases in continue production and remain with 38.0 million barrels of the Bakken-Three Forks area. competitive at lower prices. oil, averaging 1,227,344 Multiple wells are being added } In 2012, North Dakota barrels of oil per day. Natural to existing drill pads as the surpassed both California and gas production saw a high in production stays in “harvest” Alaska to become the second November 2017 of 2,096,440 mode. Three or more horizontally largest oil producer in the nation, MCF/day. Average rig count in drilled wells can be placed on behind only Texas. North Dakota 2017 was 51 rigs, an increase one existing pad and as many as is also among the top 20 oil of 16 from the previous year, but 25 wells on some pads. producers in the world. still a decrease of nearly 140 rigs since 2014. Newer, more advanced rigs are operating
www.energynd.com 19 OIL & GAS PRODUCTION
+ The above map shows the placement of shale plays around the Lower 48 states. Map courtesy of U.S. Energy Information Administration.
} A typical 2017 North Dakotan § Pays royalties of $9,300,000 } Plugging the well involves Bakken well will produce for 47 to mineral owners cementing the production years. If economical, enhanced § Pays salaries and wages of and surface casing at several oil recovery efforts can extend $2,100,000 different depths to ensure no the life of the well. Based on hydrocarbons or saltwater may an average oil price of $50 per § Pays operating expenses of pass to the surface, in addition barrel, in those 47 years the $2,600,000 to cutting off the surface casing average Bakken well: § Costs $6,700,000 to drill about four feet below the ground. § Produces approximately and complete Topsoil and subsoil that were 765,000 barrels of oil removed during the initial well } After a well has stopped construction are returned to the § Generates about $27 million producing economically, state law site and the land is returned net profit. requires the operator to plug the to its pre-drilling contours and § Pays approximately well or get it back into production reclaimed as close as practicable $5,845,000 in taxes. within six months. to the way it was prior to drilling. – $2,700,000 gross production taxes – $2,800,000 extraction tax – $345,000 sales tax
20 Spotlight on North Dakota Energy EMPIRE STATE BUILDING Height: 1,454 feet
7 E 800 10,000
PETROLEUM + Horizontal drilling in the Bakken allows companies to drill down two miles into the Bakken formation, turn at a 90-degree angle and drill horizontally for as far as four miles. Diagram courtesy of North Dakota Petroleum Council and North Dakota Department of Mineral Resources.
SHALE ENERGY TECHNOLOGY
} The Bakken shale play } The fluid used in the hydraulic Sources: North Dakota Petroleum was previously undeveloped fracturing process is 98 to 99.5 Council, North Dakota Department of Mineral Resources, U.S. Energy because conventional drilling percent water and sand mixture. Information Association, FracFocus, methods were not able to Varieties of chemical additives Energy & Environmental Research Center access the trapped oil and are used, depending on the well gas. Technological advances, conditions, to limit the growth including horizontal drilling of bacteria, prevent corrosion and the process of hydraulic of well casing, and to increase fracturing have made it possible efficiencies. for companies to economically drill for oil in the Bakken } The state of North Dakota Formation. requires disclosure of the additives that companies use } With horizontal drilling, via FracFocus.org, a website operators are able to drill more that provides public access wells from a single location, to reported chemicals used thereby accessing more of the in fracking and to provide oil and gas resources in the information on the fracking Bakken while using as much as process. 90 percent less surface area than with traditional vertical drilling. } The amount of water needed to hydraulically fracture a well } Hydraulic fracturing (also continues to increase. In 2006 called “fracking”) is a process the average Bakken well required that pumps a specially blended 2-4 million gallons of water for liquid into a well under high hydraulic fracturing. In 2017 pressure, creating fractures in that average increased to nearly the underground rock to allow 8 million gallons per well, with the flow and recovery of oil and a small handful of wells using natural gas. a technique that required 20 million gallons.
www.energynd.com 21 70°F
LIGHTWEIGHT GASES RISE THROUGH THE TRAYS 300°F NAPHTHAS GASOLINE TRAYS 390°F KEROSENES KEROSENE FOR CRUDE OIL IS HOME HEATERS, FIRST SENT TO A JET FUEL FURNACE CRUDE OIL IS 570°F GAS OILS HEATED TO DIESEL FUEL 750°F 840°F DOWNCOMERS LUBRICANTS MOTOR OIL FURNACE 910°F FUEL OIL FUEL FOR SHIPS, HEAVY, UNREFINED CANDLES OIL MOVES DOWNWARD
GASES 1070°F ASPHALT BOTTLED AND NATURAL GAS ROAD TAR PETROLEUM + Oil from the Bakken is a light, “sweet” oil, which means that it is a high-quality oil containing little or no hydrogen sulfide. Refiners prefer sweet crude oil because it yields high-value products such as gasoline, diesel fuel, jet fuel, and heating oil. This diagram of a typical refinery’s distillation tower shows how the petroleum is heated and separated into different product streams. Graphic courtesy of Bismarck State College National Energy Center of Excellence. REFINING
} Andeavor’s Mandan refinery } Andeavor processes Williston } Andeavor purchased their (formerly Tesoro) began Basin crude oil from North Dickinson Refinery (formerly operations in 1954 and is the Dakota to refine into gasoline, Dakota Prairie Refining) in 2016 largest refinery in the state. diesel fuel, jet fuel, heavy fuel from WBI Energy. That refinery The refinery has a crude oil oils, and liquefied petroleum gas. was the first greenfield diesel processing capacity of 72,000 Products are trucked and railed refinery to be built in the U.S. barrels per day (bpd). One barrel from Mandan and also shipped since the late 1970s and came is equal to 42 gallons. east via pipeline to eastern North online in May 2015. Located Dakota and Minnesota. near Dickinson, the refinery } Because of high demand for can process more than 20,000 diesel fuel in the region, in 2012 } Andeavor employs more than barrels per day of Bakken crude the Mandan refinery expanded 275 people in the Bismarck- oil into diesel fuel and other its Distillate Desulfurization Unit Mandan area and more than petrochemical components. The capacity by 5,000 barrels of 100 employees in western North diesel fuel is marketed within diesel per day to bring the plant’s Dakota and eastern Montana North Dakota, while the other total diesel hydrotreating capacity with the Tesoro High Plains Crude components are shipped to out- to 22,000 bpd. pipeline system. of-state customers or to other refineries for further processing.
Source: Andeavor
22 Spotlight on North Dakota Energy W B C O W B C O T T F F Williston Basin Crude Oil Transportation
Estimated Pipeline Export Estimated Pipeline Export EstimatedEstimated RailRail TruckTruck toto CanadianCanadian Pipelines TesoroTesoro RefineryRefinery PETROLEUM + Transportation of Williston Basin crude oil changes depending on the Brent – WTI (West Texas Intermediate) price spread. With additional pipeline capacity and market conditions, the region has seen increased use of pipelines over rail transportation. Data courtesy of the North Dakota Pipeline Authority as of December 2017.
PIPELINES
} The North Dakota Pipeline } Several additional pipeline } During construction of a Authority was created by the projects to transport the pipeline, topsoil and subsoil are state legislature in 2007 to assist increased oil and gas production removed and stockpiled nearby. development of pipeline facilities in the state have been proposed After pipeline installation, the to support energy-related or are in the planning stages. topsoil and subsoil are returned commodities. to the site, and the land is } Bakken natural gas has a high returned to its pre-construction } There are more than 30,000 content of natural gas liquids contours and production. This miles of gathering and (NGL), such as ethane, propane, includes getting land into transmission pipelines in North butane, and natural gasoline. condition for crop production or Dakota. The United States has Updated forecast calculations grazing, or working with wildlife the largest network of pipelines in from the North Dakota Pipeline groups to plant native grasses the world. Authority estimate a potential of or other vegetation for wildlife 800,000 – 1,000,000 barrels forage or habitat. } North Dakota makes use of per day of NGL production from three product types of pipelines: North Dakota during the coming 17 major crude oil pipelines, nine Sources: North Dakota Pipeline decades. Authority, North Dakota Petroleum major natural gas pipelines, and Council one carbon dioxide pipeline. } Pipelines remain the safest mode of energy transportation } A 100,000-barrel-per-day according to the U.S. Department pipeline would be equal to 500 of Transportation with more than truckloads per day or about 140 99.99 percent of all petroleum rail cars. and natural gas products safely reaching their destinations.
www.energynd.com 23 PIPELINES
NorthNorth Dakota Dakota Crude Crude Oil Oil Pipelines Pipelines
Divide Renville Burke Bottineau Rolette Cavalier Pembina Towner
Williams Pierce Walsh Ramsey McHenry Mountrail Ward Benson Grand Nelson Forks
McKenzie Eddy McLean Sheridan Wells Foster Griggs Steele Traill Dunn Mercer
Billings Oliver Barnes Golden Burleigh Kidder Stutsman Cass Valley D D Stark Tesoro Dakota Prairie Morton
Slope Ransom Hettinger Logan LaMoure Grant Richland Emmons Bowman Sargent Adams Sioux McIntosh Dickey
D Refinery Basin Transload Butte Double H Hiland Plains Bakken Oil Express Belle Fourche Crestwood Enbridge Keystone Pipeline Targa BakkenLink Bridger Dakota Access Four Bears Little Missouri Tesoro
Disclaimer: Neither the State of North Dakota, nor any agency, officer, or employee of the State of North Dakota warrants the accuracy or reliability of this product and shall not be held responsible for any Date: 6/2/2017 losses caused by reliance on this product. Portions of the information may be incorrect or out of date. Any person or entity that relies on any information obtained from this product does so at his or her own risk.
NorthNorth Dakota Dakota Natural Natural Gas Gas Pipelines Pipelines D D Divide Renville Bottineau Pembina Burke Rolette Cavalier D Towner
D D Pierce Williams DD Walsh D D Ramsey Mountrail McHenry Ward D Benson D Nelson Grand D Forks D D Eddy D D McKenzie McLean Sheridan Wells D Foster Griggs Steele Traill D Dunn Mercer
Oliver D Billings Barnes Burleigh Kidder Stutsman Cass Golden D Valley Stark Morton
Slope Hettinger Ransom Logan LaMoure Grant D Richland
Bowman Emmons D D Adams Sioux McIntosh Dickey Sargent
D Gas Plants Alliance Hess ONEOK Bakken Mature Aux Sable Kinder Morgan WBI Energy Bakken Bison Northern Border Whiting Three Forks
Disclaimer: Neither the State of North Dakota, nor any agency, officer, or employee of the State of North Dakota warrants the accuracy or reliability of this product and shall not be held responsible for any Updated: February 2018 losses caused by reliance on this product. Portions of the information may be incorrect or out of date. Any person or entity that relies on any information obtained from this product does so at his or her own risk. + Maps courtesy of North Dakota Pipeline Authority.
24 Spotlight on North Dakota Energy PETROLEUM + The above photo shows the urea production facility at the Great Plains Synfuels Plant, which started producing urea for the first time on January 19, 2018. Urea is a fertilizer widely used in the agricultural industry and sometimes as animal feed. Photo courtesy of Basin Electric Power Cooperative.
SYNTHETIC NATURAL GAS
} The Dakota Gasification } The Synfuels Plant is the largest } Urea will be the 11th additional Company’s Great Plains Synfuels carbon dioxide sequestration product produced at the Plant, north of Beulah, is the project in the world, capturing gasification plant. Besides natural only commercial-scale coal about 3 million metric tons of gas, these products include: gasification plant in the United carbon dioxide per year that § Cresylic acid States that manufactures synthetic it pipes to the aged Weyburn natural gas from lignite coal. It oil fields in Canada for use § Phenol produces about 170 million cubic in enhanced oil recovery. The § Tar oil feet of natural gas a day, which is Synfuels Plant has delivered § Ammonium sulfate shipped via the Northern Border more than 35 million metric ton (agricultural fertilizer) Pipeline to the eastern United of carbon dioxide since October States and used for heating 2000. § Anhydrous ammonia homes and industrial feedstock. (agricultural fertilizer) } Weyburn oil field operators § Carbon dioxide } The plant uses about 18,000 in Saskatchewan, predict that tons of lignite coal each day, injecting carbon dioxide can § Krypton/xenon gases supplied from the Freedom Mine. extend the life of the Weyburn § Nitrogen Besides synthetic natural gas, field by about 30 years. § Naphtha it produces many additional products that are marketed } Contractors broke ground on throughout the United States and a urea facility in July 2014 at Sources: Basin Electric Power Dakota Gasification Company’s Cooperative, Dakota Gasification worldwide, including fertilizers Company and petrochemicals. Great Plains Synfuels Plant. The project was completed in early 2018 and produces about 1,100 tons of urea a day. About 185,000 gallons per day of diesel emissions fluid are also produced and sold, as well as liquid nitrogen.
www.energynd.com 25 PETROLEUM + ONEOK’s Lonesome Creek Station, in McKenzie county, came online in 2016 and processes up to 200 million cubic feet per day of natural gas. Photo courtesy of ONEOK.
NATURAL GAS PROCESSING
} The North Dakota Pipeline } A challenge of the petroleum } According to the North Authority recently updated its industry is capturing the natural Dakota Department of Mineral natural gas forecast which gas co-produced with oil. As Resources, private industry has estimates North Dakota could of December 2017, 12 percent invested more than $13 billion in be producing 3.25 – 4.0 billion of the natural gas produced additional natural gas gathering cubic feet of natural gas each in North Dakota was being and processing infrastructure to day in the late 2020s. This is burned off, or “flared,” due to reduce flaring. up from the 2014 natural gas lack of pipelines or challenges production of roughly 1.6 billion on existing infrastructure. In } Since 2010, natural gas cubic feet per day. September 2015, the North processing capacity in North Dakota Industrial Commission Dakota has grown nearly 438 } North Dakota currently has 28 revised the 2014 natural gas percent, increasing from 491 natural gas processing plants targets for Bakken and Three MMCFD to 2,150 MMCFD in operating in western North Forks production as follows: year-end 2017. Additional Dakota, and five other new capacity is planned for 2018. facilities are planned or under § 74% Capture – construction. Oct. 1, 2014 - Dec. 31, 2014 } The state’s first liquefied § 77% Capture – natural gas plant is near Tioga. Jan. 1, 2015 - Mar. 31, 2016 Liquefied natural gas is natural gas that has been converted to a § 80% Capture – liquid form for easier storage and Apr. 1, 2016 - Oct. 31, 2016 transportation. § 85% Capture – Nov. 1, 2016 - Oct. 31, 2018 Source: North Dakota Pipeline Authority § 88% Capture – Nov. 1, 2018 - Oct. 31, 2020 § 91-93% Capture – Beginning Nov. 1, 2020
26 Spotlight on North Dakota Energy Processing Capacity – Natural Gas Owner Company County Million Cubic Feet Per Facility Day (MMCFD) 1804 Ltd Spring Brook Williams 45 Arrow Field Services Arrow McKenzie 30 Aux Sable – Chicago, IL Prairie Rose Mountrail 126* Caliber Midstream Hay Butte McKenzie 10 Hess Tioga Williams 250 Kinder Morgan Watford City McKenzie 90 Kinder Morgan Roosevelt McKenzie 55 Kinder Morgan Badlands Bowman 40 Kinder Morgan Norse Divide 25 Liberty Midstream Solutions County Line Williams 20 Oasis Wild Basin McKenzie 145 ONEOK Lonesome Creek McKenzie 200 ONEOK Stateline I Williams 120 ONEOK Stateline II Williams 120 ONEOK Garden Creek I McKenzie 120 ONEOK Garden Creek II McKenzie 120 ONEOK Garden Creek III McKenzie 120 ONEOK Grasslands McKenzie 90 ONEOK Bear Creek Dunn 80 ONEOK Marmarth Slope 7.5 ONEOK Lignite Burke 6 Petro Hunt Little Knife Billings 27 Targa Resources Badlands McKenzie 90 Tesoro Logistic Rockies Robinson Lake Mountrail 130 Tesoro Logistic Rockies Belfield Stark 35 True Oil Red Wing Creek McKenzie 10 USG Midstream Bakken DeWitt Divide 3 Whiting Oil & Gas Ray Williams 10 XTO – Nesson Ray Williams 25 Total 2,149.5
*Aux Sable facility has capacity to transport and process up to 110 MMCFD of North Dakota natural gas at its Chicago facility.
www.energynd.com 27 PETROLEUM MARKETING / PROPANE
} According to the North Dakota } In 2017, retail petroleum } North Dakota petroleum Petroleum Marketers Association, dealers sold 458,617,384 gallons marketers also supply another there are more than 400 of taxable gasoline in the state, fuel critical to the state – petroleum marketers in North as well as 698,060,273 gallons propane. Propane is a 100 Dakota. The list includes service of taxable special fuels other than percent domestic fuel, serving station dealers, convenience propane (mostly diesel). North to fortify national and energy stores, and truck stops. These Dakota petroleum marketers security. Propane supplies have operations deal in every aspect of continue to support research and grown dramatically in recent refined petroleum and renewable development of renewable fuels years because of the numerous fuel products ranging from as viable sources of alternate oil shale plays in the United wholesale and supply to the energy. States. Propane serves a variety numerous retail outlets scattered of residential, commercial, and across the state. industrial needs. It is used as the prime heating source in 13.4 percent of homes in North Dakota. In 2017, the state’s propane marketers sold roughly 144.1 million gallons of propane.
Source: North Dakota Petroleum Marketers Association
ETHANOL
} North Dakota’s five ethanol } The state’s ethanol industry } Approximately 160 – 180 plants have an annual production generates nearly $625 million in million bushels of corn are used capacity of nearly 525 million economic activity each year and annually, with more than 80 gallons per year, which is more directly employs more than 230 percent of the corn purchased than five times the production a workers in rural communities from North Dakota farmers. decade ago. across the state.
Corn Used Ethanol Capacity DDG Plant Location Employees (million (million gallons) (tons) bushels) Midwest Ag Energy – Underwood 42 70 25 200,000 Blue Flint Ethanol Hankinson Renewable Hankinson 47 145 51 440,000 Energy, LLC Red Trail Energy, LLC Richardton 48 63 23 180,000 Tharaldson Ethanol Casselton 55 175 65 500,000 Midwest Ag Energy – Spiritwood 40 70 25 200,000 Dakota Spirit Totals 232 523 189 1,520,000
28 Spotlight on North Dakota Energy BIOFUELS + Tharaldson Ethanol, located just west of Casselton, uses the City of Fargo’s wastewater to operate. Photo courtesy of Tharaldson Ethanol.
ETHANOL
} One-third of every bushel of } In a modern ethanol facility, } North Dakota is a national grain used for ethanol production one bushel of corn produces 2.8 leader in the installation of flex- returns to the animal feed market gallons of ethanol, 18 pounds of fuel blender pumps, which allow in the form of dried distillers livestock feed (DDGs), 18 pounds most vehicle owners the option grains (DDGs). More than of carbon dioxide, and up to one of a 15 percent ethanol blend, 1.5 million tons of DDGs are pound of corn oil. and higher percentage ethanol produced in the state annually. blends for owner/operators of } E15 (85 percent gasoline, 15 flex-fuel vehicles. There are 50 } Approximately 10 percent of percent ethanol) is for use in locations statewide that offer the ethanol produced annually all 2001 and newer cars and E15 – E85 fuel blends, with 17 in North Dakota is blended with light-duty vehicles, as well as of those locations offering E15 gasoline and sold within the flex-fuel vehicles. These vehicles fuel specifically. Nearly all retail state. The remaining 90 percent make up 75 percent of the light gasoline dealers offer E10 fuel. is shipped primarily to the east or duty vehicles on the road today, west coasts. representing more than 85 Source: North Dakota Ethanol Council percent of the unleaded fuel sold in the nation.
www.energynd.com 29 BIOMASS / BIODIESEL
} Biomass includes all plant } North Dakota’s only biodiesel } Research is being done on and animal matter, such as production facility is located near biomass availability from crop wood waste, energy crops, Velva. The ADM plant has the residues, and the potential use crop residues, and other forms potential to produce 85 million of oilseed crops like carinata, of organic waste. Harvested gallons of biodiesel per year. canola, and camelina to biomass can be used to generate The facility is currently producing produce jet fuel for military and various forms of energy, such as biodiesel with canola oil provided commercial aviation uses. The heat, electricity and biofuels. by an adjacent crushing plant. field research is being conducted Because of low in-state usage, at the USDA Northern Great } Biodiesel is a domestically most of the produced biodiesel Plains Research Laboratory in produced, renewable fuel that is shipped to other states or to Mandan. can be manufactured from Canada. new and used vegetable oils, Sources: Great River Energy, Clean animal fats, and recycled } At the Andeavor oil refinery Cities (DOE), City of Bismarck, USDA restaurant grease. Biodiesel’s in Dickinson, plans have been Northern Great Plains Research physical properties are similar announced to co-process Laboratory, Andeavor to those of petroleum diesel, renewable feedstock along with but with significantly reduced Bakken crude oil to produce a 5 greenhouse gas emissions and percent renewable diesel blend. toxic air pollutants. Biodiesel can Andeavor plans to retrofit the be blended and used in many plant to allow co-processing of different concentrations. The most up to 16,800 gallons per day common biodiesel blend is B20 of renewable feedstock using (20 percent biodiesel, 80 percent regionally-sourced soybean petroleum diesel), which qualifies oil and distillers corn oil from for fleet compliance under the ethanol plants. federal Energy Policy Act of 1992.
ENERGY RESEARCH
} North Dakota energy industry partners are } The Allam Cycle is a new technology for working with officials from the state and the U.S. generating electricity. It consists of gasifying Department of Energy on carbon solutions for the lignite coal to produce synthetic natural gas, electric generation industry. The Lignite Energy which would be combusted along with oxygen Council, ALLETE, Inc., (parent company of BNI to produce supercritical carbon dioxide to drive Energy and ALLETE Clean Energy, Inc.), Minnkota a turbine generator. Because of its design, this Power Cooperative, and Basin Electric Power power cycle would have the ability for full carbon Cooperative are collaborating to develop these dioxide capture. Research and development cost for technologies for both electricity generation and commercializing this technology is estimated to be carbon dioxide capture, including the Allam Cycle around $900 million by 2024. and Project Tundra. } Project Tundra is a carbon dioxide-capture retrofit of Unit 2 of the Milton R. Young Station near Center. The technology for this project was recently deployed at NRG’s Petra Nova project in Texas as a first-of-a-kind installation. Research and development cost for a larger scale, more efficient installation of the technology in North Dakota is estimated to be around $1.25 billion by 2024.
30 Spotlight on North Dakota Energy + Energy & Environmental Research Center (EERC) researchers on location performing tests for CarbonSAFE initiative. The project investigates the feasibility of capturing carbon dioxide emissions from coal-based power plants and storing it underground. Photo courtesy of the EERC.
ENERGY RESEARCH
} The Energy & Environmental Research Center’s } EERC is also conducting research on extracting (EERC) CarbonSAFE Initiative (Carbon Storage rare earth elements from lignite coal. While 90 Complex Feasibility Study) is a research project percent of rare earth elements are produced in investigating the feasibility of taking captured China, EERC has received more than $3.5 million carbon dioxide emissions from coal-fired plants, in funding to find a way to extract those elements compressing it, and injecting it a mile deep from lignite. Rare earth elements include europium, underground into the Broom Creek Formation in dysprosium, erbium, terbium, neodymium, Oliver and Mercer counties, preventing the carbon holmium, scandium, lutetium, and yttrium, among dioxide from being emitted into the atmosphere. others. They’re used in everyday items, such as computer memory chips, rechargeable batteries, } Red Trail Energy, which owns an ethanol plant DVDs, cell phones, catalytic converters, magnets, near Richardton, and the EERC began investigating fluorescent lighting, electronics, and more. Critical a way to reduce the carbon dioxide emissions for defense, they are used by the military in night- associated with ethanol production. The EERC vision goggles, precision-guided weapons, GPS, was awarded $345,000 from the North Dakota and electronics. They are also essential for green Renewable Energy Program to research carbon energy applications such as wind turbines and capture, utilization, and storage (CCUS) technology hybrid/electric vehicles. Project sponsors include at Red Trail Energy’s ethanol plant near Richardton. the U.S. Department of Energy, the North Dakota By reducing emissions at the ethanol plant, it allows Industrial Commission Lignite Research Program, energy producers to sell ethanol to states that have Great River Energy, North American Coal, Minnkota low-carbon fuel programs, such as California. Power, and Great Northern Properties. CCUS technology captures and permanently stores carbon dioxide emissions. Sources: ALLETE, Basin Electric Power Cooperative, Energy & Environmental Research Center
www.energynd.com 31 + Minnkota Power Cooperative has two electric vehicle charging stations at its headquarters facility in Grand Forks. Minnkota’s stations represent one of the three charging locations currently available in Grand Forks. Photo courtesy of Minnkota Power Cooperative.
ENERGY EFFICIENCY
} The North Dakota Department of Commerce } The eFargo program was formed to enter Fargo has an Office of Renewable Energy and Energy into the Georgetown University Energy Prize (GUEP) Efficiency that promotes efficiency activities within competition in which 50 cities across the United the state in both the public and private sectors. States are taking innovative actions in the way they understand, use, and plan energy use reduction. } According to the North Dakota Department of eFargo’s goals of reducing overall energy use in Commerce, 600 housing units were weatherized Fargo by 5 percent, increase renewable energy use in North Dakota in 2017. Homeowners achieve by 5 percent, and reduce the utility bills of Fargo an average of 7-18 percent lower energy costs customers by 5 percent, was selected as the winner (about $283/year). Clients can expect savings of of the two-year effort. According to calculations over $4,000 during the lifetime of the measures from the GUEP, the city of Fargo and its residents installed. Additional health benefits bring the total have saved $4,823,316 since the program’s savings to over $13,000. inception. Fargo will receive a prize package that includes in-kind support toward the goal of } North Dakota Department of Commerce obtaining $5 million in financing for an energy administers the Energy Conservation Grants, which efficiency dream project, as well as workshops and is funded by a one-half of 1 percent of the oil education opportunities for the winning community. extraction tax deposited in the Resources Trust Fund up to $200,000 for the current biennium. Grants } According to Auto Alliance, North Dakota’s can be used for energy efficiency projects in public ranking of electrical vehicle sales for 2016 was buildings. To date, 68 completed projects have 48th in the nation with .04 percent of the market. received funding, at an average project cost of While electric vehicles are not commonplace in $33,265. North Dakota, there are 16 public charging stations around the state.
Sources: North Dakota Department of Commerce, U.S. Green Building Council, North Dakota Geological Survey, eFargo, PlugShare.com, Auto Alliance
32 Spotlight on North Dakota Energy NORTH DAKOTA TAXES
} According to the Office of State Tax communities and businesses to “catch their breath” Commissioner, North Dakota is undergoing a and plan for a sustainable level of growth going period of economic correction after years of record forward. expansion. The correction is the result of a 70 percent drop in oil prices followed by a period } The Legacy Fund was established in 2010 as the of slow price growth as well as four consecutive state’s “nest egg” and is funded by 30 percent of years of low agricultural commodity prices. During the state oil and gas production taxes. At the end of the first three quarters of 2017, taxable sales and January 2018, the Legacy Fund had received $4.21 purchases grew by a modest 1.6 percent over billion in deposits. Interest earnings from the Legacy the same three quarters of 2016. For calendar Fund will be transferred to the State General Fund year 2017, oil and gas gross production and oil beginning in the 2017-2019 biennium. Legislators extraction tax revenues were $1.6 billion, down can spend the principal of the fund with a two- from a record $3.5 billion in calendar year 2014. thirds majority vote in each house. There is an While low oil and commodity prices – and slow additional limitation restricting any expenditure of growth in taxable sales and purchases – are Legacy Fund principal to a maximum of 15 percent measurements of an economic slowdown, in the in any two-year period. case of North Dakota, they more accurately signify a leveling off from the super-heated growth of Sources: North Dakota Tax Department, North Dakota the past eight years. State officials denote the Office of Management and Budget slow down allows for a much needed chance for
NORTH DAKOTA JOBS
} The North Dakota Department of Mineral Transportation & Material Moving) accounted for Resources estimates that, depending on the price 1,297 of those openings. These figures reflect an of oil, an additional 40,000-45,000 wells will be annual decrease in openings across the state and drilled over the next 30 years or so. The state could in the 17 oil and gas producing counties, in part see a peak of about 87,000 oil related jobs near because of the downturn in the oil and gas sectors. 2030, with about 70,000 of those jobs being long term. Sources: Job Service North Dakota, North Dakota Department of Mineral Resources } Job Service North Dakota (JSND) data (Short-Term Employment Projections 2016 – 2018) shows that in 2016, an estimated 21,050 workers were in direct or support positions for the industries of oil and gas extraction, coal mining, utilities and pipeline transportation, with an estimated individual annual wage of approximately $103,860. These statistics do not reflect employment or wages in ancillary businesses or industries working in the energy field, such as trucking, construction, engineering, manufacturing, and repair services.
} There continue to be numerous job opportunities in the state. Data from JSND’s Online Job Openings Report showed a total of 12,797 openings in December 2017. The two occupational groups most closely associated with opportunities + A worker checks equipment at a hydraulic fracturing in the oil patch (Construction & Extraction and site in the Bakken. Photo courtesy of Whiting Petroleum.
www.energynd.com 33 + A Bismarck State College Mechanical Maintenance Student uses a milling machine to complete his final project of designing and fabricating a tool. Photo courtesy of Bismarck State College National Energy Center of Excellence.
EDUCATION / WORKFORCE TRAINING
} The Bismarck State College (BSC) National Energy § BSC’s NECE also provides customized training Center of Excellence (NECE) has been training the for regional and national energy companies to current and future workforce in the energy industry maintain certification/training requirements, since 1970. With twelve program areas offering educate new hires and to supplement existing degree or certificate options, BSC provides expertise training programs. in operations, technician, and maintenance roles in power plants and process facilities, as well as in § BSC’s Bachelor of Applied Science degree in transmission, distribution, and system operations. Energy Management was ranked the 13th most Other programs include petroleum production, affordable online management degree in the water and wastewater technology, and a Bachelor nation by GetEducated.com, a consumer group of Applied Science in Energy Management. that publishes online college rankings and online university ratings. § Approximately 1,000 students are enrolled in a BSC energy program either on campus or } BSC is the lead institution for a U.S. Department online every semester, utilizing world-class lab of Labor grant of $9.9 million to expand and equipment, online simulations and animations, improve training for energy-related careers. The and real-time lab sessions. four-year grant was awarded in 2014 to the TREND Consortium, a partnership between the state and § In 2017, 330 students earned a degree or tribal institutions of BSC, Sitting Bull College, Turtle certificate in one of the BSC NECE programs. Mountain Community College and Williston State College. § Of those graduates that replied to a BSC Career Services survey, 99 percent were } The Harold Hamm School of Geology and continuing their education or were employed. Geological Engineering at the University of North Recent graduates who were employed reported Dakota provides education and research in salaries ranging from $20 – $40 or more per petroleum geology and related fields. hour. } Lake Region State College in Devils Lake offers a wind energy technician program that utilizes a 1.6 MW wind turbine near campus.
34 Spotlight on North Dakota Energy } North Dakota State University in Fargo offers } The Energy & Environmental Research Center a number of programs in engineering, geology, (EERC), located at the University of North Dakota agriculture and other degrees that prepare students in Grand Forks, is a world leader in providing for career paths in many fields, including energy. solutions to energy and environmental challenges. Other state higher education institutions, including The EERC has a multidisciplinary team of 200 Williston State College, Minot State University highly skilled engineers, scientists and support and the North Dakota State College of Science at personnel. The EERC employs and mentors students Wahpeton, provide a variety of degree programs in many disciplines. Its core priorities include coal that prepare graduates for careers in energy fields. utilization, carbon dioxide management, oil and gas, alternative fuels and renewable energy, and } Bismarck State College, Williston State College, energy–water management. Lake Region State College and North Dakota State College of Science are partners in TrainND, which } Via a partnership between the energy industry, works with businesses to provide tailored training the North Dakota Industrial Commission, the State programs in a variety of energy fields, including oil Historical Society of North Dakota, and the Great and gas operations, lease operators, well servicing, Plains Energy Corridor at BSC, energy curriculum wind energy, welding, etc. was added to the 4th and 8th grade North Dakota Studies courses. The two-week curriculum offers photos, videos, maps and animations related to North Dakota’s energy resources and is available online at www.ndstudies.gov.
Sources: Bismarck State College, University of North Dakota Energy & Environmental Research Center
+ ENERGY: Powered by North Dakota provides 4th and 8th grade energy curriculum for North Dakota students.
+ A Bismarck State College Mechanical Maintenance student uses a cutting torch to make sections of pipe usable for future class projects. Photo courtesy of Bismarck State College National Energy Center of Excellence.
www.energynd.com 35 NORTH DAKOTA’S ENERGY RANKINGS IN THE US
Crude Oil # Production 2 Bismarck State College Wind # National Energy Center Production 5 of Excellence PO Box 5587 Bismarck, ND 58506-5587 Total Energy Production # (701) 224-2410 6 [email protected] energynd.com Coal # Production 9
Ethanol Production # ACKNOWLEDGMENT AND DISCLAIMER 10 This material is based upon work supported in part by the Office of Energy Efficiency and Renewable Energy (EERE), U.S. Department of Energy, under Award Number DE-EE0007482; and funded in part by the North Dakota Natural Gas Department of Commerce Office of Renewable Energy and Energy Efficiency. # Production 11 This report was prepared as an account of work supported in part by an agency of the United States Government. Neither the United States Government nor any agency thereof, nor any of their employees, makes any warranty, express Total Net Electricity or implied, or assumes any legal liability or responsibility for the accuracy, # completeness, or usefulness of any information, apparatus, product, or process Generation disclosed, or represents that its use would not infringe privately owned rights. 33 Reference herein to any specific commercial product, process, or service by trade name, trademark, manufacturer, or otherwise does not necessarily Sources: U.S. Energy Information Administration, American Wind Energy Association, Renewable Fuels Association constitute or imply its endorsement, recommendation, or favoring by the United States Government or any agency thereof. The views and opinions of authors expressed herein do not necessarily state or reflect those of the United States Government or any agency thereof.
On the cover: A rig at work at a ConocoPhillips well site in the Corral Creek Unit in North Dakota. During 2017, ConocoPhillips net production averaged 65 MBOED (Million Barrels Oil Equivalent per Day) in the Bakken. ConocoPhillips is at the forefront of adopting technological advances in horizontal drilling and multi-stage hydraulic fracturing to optimize the development of very complex reservoirs. Accelerated implementation of these innovative methods is playing an important role in the development of the company’s approximately 2,400 identified operated and non-operated drilling locations. Photo courtesy of ConocoPhillips.
36 Spotlight on North Dakota Energy