At a daily consumption of 19.2 million barrels of oil, the United States is one of the world's biggest consumers of oil and gas. The US currently produces a mere 9.8 million barrels of oil daily, which necessitates oil importation from foreign suppliers from the Middle East.
However, this can dramatically change with the discovery of the Bakken Basin and its consequent development in the 15 years that followed its discovery in 1996. To date, it is the largest inland continuous oil reserve, according to the United States Geological Survey (USGS).
Here's what analysts say about the Bakken Basin's possible impact in the US economy, industry, society, and environment:
Reduction in Oil Importation
As mentioned, the US consumes more oil than it produces on a daily basis, and oil importation has become one of the leading concerns of industries nationwide. However, with the introduction of the Bakken Basin's estimated capacity of 503 billion barrels of oil, some industry analysts predict freedom from importation for the country for the next 40 years or so.
Impact on World Oil Prices
The worldwide supply and demand for oil, coupled with other factors, continually influence the price of oil in the world market. But with the discovery of the Bakken Basin, the Center for Strategic and International Studies predicts a major impact on world oil prices. Already, the sudden abundance of oil in the US has resulted to a price distortion between the prevailing price of oil in the world market and that in the US.
Skyrocketing Stock Prices
Needless to say, investors in the Bakken Basin are seeing their profits multiply faster than usual. This growth is amplified by the bill passed in the state of Montana that would grant an 18-month tax holiday for oil wells drilled and completed in the area.
To illustrate how big and unprecedented this development is, consider a small oil-and-gas company which luckily established a foothold in the Bakken Basin in 2007. Within the year, they saw an increase of their stock prices from $3 to $7. This 133% gain is just the beginning of an investment that could see bigger increases of more than $200 per share. Bigger companies are seeing stock prices jumping 775% in 10 months, and the trend remains true to the present.
Thousands of Jobs Created
With dozens of oil drilling rigs erected annually across the Bakken Oil Formation from Northern Montana, to North Dakota and Canada it's unsurprising that the oil workforce has grown. According to the North Dakota State University, employment in the oil industry has grown from 5,000 in 2005 to more than 18,000 in 2009.
This upward trend will remain as oil companies continue to spud oil rigs and extract thousands of barrels of oil per prospect every year, although companies still face the challenge of finding qualified workers for their oil fields.
Environmental Concerns
As with all extractive industries, the environmental impact of this oil boom is being monitored by environmental groups, especially with the process that called fracking which the industry employs to harvest oil from between layers of rock. Fracking affects water wells in the North Dakota and Montana area. At present, oil companies operating in the area comply with federal standards; the challenge for them now is to find better ways of drilling, extraction, transportation,and refining of oil that would have lesser negative impact on the environment.
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