Posted 3/01/16 (Tue)
By Neal A. Shipman
In most normal years, the annual meetings of the Watford City Area Chamber of Commerce and the Watford City Economic Development Corporation are a time of good news and of community growth and optimism. But, the news coming out of last week’s annual meetings weren’t quite as upbeat.
In fact, most of the news was downright scary for a community that has pinned its future on the oil industry. With rig counts falling as a result of lower oil prices, oil companies scaling back well completions, and virtually every company tightening their belts, it was hard to find the silver lining.
But for Watford City and McKenzie County, even as the oil industry struggles to find the normal in these uncertain times, there is still a silver lining. Unfortunately, the realization of that silver lining may be a few years away.
First, according to Ron Ness of the North Dakota Petroleum Council, the Bakken Formation is a world class resource that holds billions of barrels of recoverable oil. And Watford City and McKenzie County are at the very epicenter of that formation. Which means when oil prices recover, which is expected to occur in late 2016 or in 2107, this will be the first place that oil companies are going to return to.
Second, while Saudi Arabia and other OPEC nations have increased their oil production to record levels, American oil companies have made huge technological strides to improve well efficiency and production even in these times of low oil prices. And that means that when oil prices do begin to rebound, those efficiencies will allow American producers to put their wells back on line and be profitable at lower prices.
And when oil prices do recover, there is probably no county or city in North Dakota better prepared to take advantage of the situation than is McKenzie County and Watford City.
When all of the oil activity began happening in McKenzie County, both the county and Watford City reacted in a positive manner that has positioned us well for the future by building roads, sewer and water infrastructure to meet the growing demand.
Key to those developments was the building of the Western Area Water Supply that provided for Watford City’s and McKenzie County’s future water needs, and the upgrading and construction of county and city streets to handle the traffic loads. In addition, Watford City expanded its water supply systems and built new waste water treatment facilities in order to accommodate a population of up to 15,000 people.
Along with that infrastructure growth, the city saw a tremendous increase in the number of new apartments and hotels, as well as having land developed for the construction of new single family homes.
During the past six years, Watford City and McKenzie County haven’t been sitting idle, they have been planning and building for the future. While many of the counties and smaller cities in the state’s oil patch failed to plan and act, Watford City and McKenzie County saw the future and invested wisely.
Those wise investments include the new Watford City High School, the soon-to-be-completed Event Center in Watford City and the new county Law Enforcement Center, as well as the new healthcare facility, which will begin construction this Spring.
A decade ago, no one had ever heard of the Bakken Formation or could imagine the economic impact that it could have on this region of the state. Today, we know that this oil and natural gas formation holds the key to a bigger and brighter future.
And that is the silver lining that each and every one of us must hold on to during this period of low oil prices.