BISMARCK, N.D. — The North Dakota Senate snuffed out a measure Wednesday aimed at curbing the oil industry’s practice of wasting natural gas as an unwanted byproduct of oil production.
The bill, arguably the toughest to date against the oil industry in North Dakota, was defeated 34-13.
Sen. Tim Mathern’s measure would have cut an exemption commonly used by oil companies claiming an economic hardship of connecting a well to a natural gas pipeline. Oil companies in North Dakota can flare natural gas for a year without paying taxes or royalties on it. After that, companies can request an extension because of the difficulty of connecting the well to a natural gas pipeline. The exemption is nearly always granted by state regulators, who took no position on the legislation.
About one-third of North Dakota’s gas production has been burned off, or “flared,” since the oil boom began about five years ago. Less than 1 percent of natural gas is flared from oil fields nationwide, and less than 3 percent worldwide, according to the U.S. Energy Department’s Energy Information Administration.
Mathern, a Fargo Democrat, told fellow lawmakers Wednesday that the amount of natural gas flared in North Dakota could heat 500,000 homes and accounts for one-quarter off all natural gas burned off nationally.
Satellite photos of western North Dakota’s burning oil patch can be seen clearly from space, he said.
“It looks like a metropolitan area at night,” Mathern said. “It glows.”
Democrats and Republicans have increasingly been critical of flaring in North Dakota though legislative efforts to crack down on the practice have been near nonexistent.
“We seem content to turn our heads and ignore natural gas flaring,” Mathern said.
Oil and pipeline companies have told lawmakers that they’re working as quickly as possible to capture the gas and have invested $4 billion to move it to market.
North Dakota’s oil production has increased exponentially in the past decade with improved horizontal drilling techniques into the Bakken shale and the Three Forks formation below it. North Dakota was the ninth-largest oil-producing state in 2006, but has since risen to No.2, behind Texas.
Sen. Bill Bowman, R-Bowman, encouraged fellow senators to be patient and allow companies to catch up.
“The way we’re growing it takes time to coordinate and capture gas and take it to refineries,” Bowman said. “It does take time for these things to happen and it’s happening.