IPAA independent petroleum association of america, america's oil and gas producers

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For Immediate Release
May 7, 2010


New Technologies Unlocking Job-Creating American Energy Across the Nation

Natural Resources Trust Fund Big Winner as Oil, Natural Gas Producers Invest in Michigan

WASHINGTON - America's energy potential is growing by the day. And thanks to new, 21st century technologies, and the hard work, hustle and commitment from America's independent oil and natural gas producers - who drill 90 percent of the nation's wells and on average employ only 12 workers - great strides continue to be made in our economy and for our energy security.

And while oil and natural gas-producing states like Texas, Wyoming, Oklahoma and Pennsylvania are traditional heavy-weights, other energy-producing states, such as Michigan and North Dakota, are joining these ranks.

The Detroit Free Press reports earlier in the week that "Michigan's gas and oil industry entered a new era Tuesday with a record-setting auction that will be a windfall to the state's land trust fund and could signal a boom in drilling across the northern Lower Peninsula." Because of 21st century technologies, such as horizontal drilling coupled with the 60-year old energy stimulation technique called hydraulic fracturing, a "possible boom in a deep formation known as Utica Shale" could be on the horizon for the Wolverine State.

This from the article under the headline "Bids fuel speculation on Mich. drilling boom":


The high-rolling bidders for leases to mineral rights on state-owned parcels stunned state officials and other bidders in what became -- within hours -- the most lucrative oil and gas rights sale in state history.

"It surpassed everyone's expectations," said Tom Wellman of the Department of Natural Resources and Environment.

"You are witnessing a historic event," a tiring Howe said at mid-afternoon, after he and a partner had rung up about $150 million in sales for the state, money designated for the natural resources trust fund.


Michigan Governor Jennifer Granholm says the auction is "great news for the state." This from Platts' Gas Daily:


"This will be an economic stimulus to many communities in northern Michigan and aligns with our state's plan to diversify the economy and grow good-paying jobs," she said. "The state has safely and wisely been developing our oil and gas resources for almost 100 years, and for three decades has ensured that the revenues generated from that development are used to enhance recreational opportunities across Michigan."


And in North Dakota, the economic activity associated with producing oil from the state's Bakken Shale - as well as the Three Forks-Sanish formation - continues to be overwhelming. The Grand Forks Herald reports this earlier in the week about the Bakken, which is producing "500 to 600 barrels [of oil] every day" and helping to keep North Dakota's unemployment rate low and the state financially strong:


In 1991, everyone knew the Bakken had oil. But the oil couldn't be recovered economically, because of the dense rock formation, not at the levels of technology and oil prices of that day.

But LeFever and her co-authors wrote back then: "The potential for exploration and new discoveries in the Bakken is immense." They said that looking at the rock and the wells already drilled "suggest that significant amounts of undiscovered Bakken oil remain to be found."

It all came true. North Dakota now is the nation's fourth-largest oil producing state.

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IPAA is the national trade association representing oil and natural gas producers that drill 90 percent of the nation's oil and natural gas wells. These companies account for 68 percent of America's oil production and 82 percent of its natural gas production.