Lots of you out there surely remember that old TV favourite 'The Beverley Hillbillies' - humble farming folk striking oil in their backyards and life was never the same again. Well, there's a contemporary version of that tale happening as we speak in North Dakota. But, unlike the uncomplicated days of old, the new oil millionaires can't escape one burning issue - if you'll pardon a very ordinary pun - America's dire need for alternative sources of energy. Here's Ginny Stein.

 

REPORTER:  Ginny Stein

FLOYD BREHM: This is authorised personnel only but I own the land so I guess we can drive here.

Floyd Brehm is a proud North Dakotan farmer. And he's taking me to see the field which, after a lifetime of toil, has finally made him rich.

FLOYD BREHM: I feel the vibration there. That must mean when the oil is going through the pipe.

REPORTER: It's a good feeling?

FLOYD BREHM: Yep.

This is the 84-year-old's first oil well, and one of the first in the district to come on line in the current boom.

FLOYD BREHM: It's 500 hundred barrel a day, and a barrel is 40-some gallons, so that's quite a lot of gallons in a day.

REPORTER: And you get a cut out of every barrel?

FLOYD BREHM: Yeah. A certain per cent, yeah.

Exactly how rich Floyd is likely to become is a private matter but with more wells starting to produce, one thing is certain - money is no longer a concern for him or his son and daughter.

CURTIS BREHM, SON: It takes the pressure off. He was worried about mortgages and how we would be after he was gone. And that just takes the pressure off, where he knows everything will be OK.

Floyd is a second-generation homesteader. And he doesn't expect life to change much now, despite his newfound wealth.

FLOYD BREHM: 'Comin' around the mountain'. I'm just the same old me. I don't know. I might buy a new pickup some day, I don't know.

RON NESS, NORTH DAKOTA PETROLEUM COUNCIL: There are anecdotal rumours we are making a millionaire every day in North Dakota right now. And certainly there have been a number of stories reported about these people but, if you get one or two wells on your land and you have a sixth or an eight royalty and that well is producing between maybe 400 and 800 barrels a day you are going to be a millionaire in a short period of time.

Ron Ness is the president of the North Dakota Petroleum Council. His state sits on part of what's called the Bakken, a vast rock formation which has enormous potential reserves of oil - maybe as much as 400 billion barrels.

RON NESS: With current technology, which is improving every day, we can get 1% to 2% of the oil out of the Bakken that we may be able to collect 2 billion barrels in North Dakota.

Farmers in western North Dakota have long known there's oil underground but getting to it has been the problem. Now record high prices have inspired drillers like Blaine Hoffman to go after the reserves using new technology.

BLAINE HOFFMAN, WHITING OIL: It's like trying to push a piece of spaghetti, you know, through a tube, that's two miles.

Oil wells here are no longer drilled straight down. Now they bend.

BLAINE HOFFMAN: When they first started drilling horizontal Bakken wells, just the technology for the directional tools being able to drill out there two miles horizontal is one of the big things.

Horizontal drilling was one development, but another breakthrough was still needed. It's the fracking, or fracturing process, that makes it possible to recover the vast oil reserves below. But it's a relatively new process and one that's carefully

KATHY NESET, GEOLOGIST: This is middle Bakkan. This is the source rock. It's solid rock. You would look at this and say impossible - you can't get oil out of that. But you can.

Kathy Neset is a geologist who first arrived in North Dakota at the end of the last boom. She believes the good times are back.

KATHY NESET: It is a boom. It is truly a boom. I mean, when I look back over the years that I have done this - I came to North Dakota in the late '70s, early '80s – boom time. We are nearing - maybe not as many rigs, although we do have a lot of rigs drilling right now - but we are nearing, you know, surpassing the production of that time.

Across North Dakota, oil rigs are drilling as fast as they can. They want to get the oil out while prices are high.

BLAINE HOFFMAN: Well, right now we have close to 25 wells drilled. Two years down the road we will probably have a 120 drilled and then it depends on how it goes on from there. With any oil field there is limitations but we are hoping to have 120 to 160 wells in this area.

FRED EVANS, FARMER: Look at the size of these. This is durum wheat.

Fred and Joyce Evans are farmers who, like many North Dakotans, can trace their family lines back for generations.

JOYCE EVANS: My mum, she just lived over the hill this way, I don't know where your Dad...?

FRED EVANS: He lived over the hill that way.

JOYCE EVANS: So all the kids would walk to school and they had summer school also, just in the summer.

This old schoolhouse stands on the farm they bought piece-by-piece from money Fred saved in his early years working on oil rigs.

FRED EVANS: Maybe my dad's would be on here somewhere. There's Verne Cunningyon, O.J.

But farming is now almost a sideline - it's oil that's keeping them busy.

FRED EVANS: But the royalty's usually one-eighth on those. Boy, he's going to be on easy street.

They have stakes in about a dozen wells, producing both oil and gas.

FRED EVANS: It's going to come back again, it kind of goes up and down. Watch her now. She is going to go. It looks pretty good now. I wonder how much higher it is going to go. We should have brought wieners along and had a wiener roast. There it comes, Old Faithful. That's nice. Oh, yeah. That's just the way we want, more of that.

This well has just come on line. Just how much it's producing is not yet known.

FRED EVANS: I don't know exactly but I would guess this is making maybe 200, 300, 400 barrels a day, so it's not one of the big, big wells, 'cause some of them came in at 2,000-3,000 barrels a day. The best I've heard is 400 barrels a day - 4,000 thousand - not 400 - 4,000. I'm not used to all those zeros.

ANNOUNCER: And how many people are cheering for the green one? And who's going to be pulling for the pig in pink? On the count of three - no cheating, get your head back. Here we go, one, two - make some noise - three. And they are off. And it's going to be close. It's the going to be the blue one. The blue one is the winner.

At the state fair in Minot there's no doubting North Dakota’s humble origins. But this year it seems there's plenty of money to throw around, including at the one item that typifies gas-guzzling America.

DALE DALLMAN, MOTOR HOME SALESMAN: Actually this one is a 40-foot diesel pusher motor home. And this is an entry-level one at about $250,000. So you want to have a look inside?

Dale Dallman is a motor home and campervan salesman.

DALE DALLMAN: It gives you lots of room in here. It comes with full built-in televisions, back-up cameras. You will notice it has tops in the kitchen. The bedroom back here has washer-drier, king-size bed. You get a lot of the people that have had oil discovered on their land and they get vast big cheques all of a sudden and they really don't know what to do with them. So we are selling a few motor homes to them so they can go travel the US and see what's out there. It is the first time they've ever been able to do that.

In the past week at this fair alone, he's sold more than half a dozen campervans and motor homes. It's not just individuals that have struck it rich here. While much of the rest of America is in debt, this year North Dakota's government has to decide what to do with its surplus. Kenton Onstad is a member of the state legislature.

KENTON ONSTAD, NORTH DAKOTA LEGISLATOR: The oil boom and the discovery and the potential of it is, it's a huge revenue source for North Dakota. North Dakota is going to have, when we go into the next legislative session, we are going to have a $1 billion surplus.

While North Dakota is trying to decide how to handle its oil boom, America as a whole is pondering its energy future. Today, in the nearby state of Nebraska, more than 1,500 people have shown up to hear a famous former oilman speak about his alternative energy plan.

MAN: Mr Pickens is a pretty prominent individual in this country and I am just kind of interested in what he's got to say today as it relates to, oh, cheaper fuels to move our vehicles, heat our homes, run our businesses.

T. BOONE PICKENS, FORMER OIL MAN: Thank you. Thank you. Now serious. Let's talk serious. You came, probably 10% of you came, because you thought, "I am going to see that guy. He's 80 years old, it may be the last time I ever see him." But I think 90% of you came because of the message that I have.

This is T. Boone Pickens. He made millions drilling for oil and turned that into billions as a corporate raider. Pickens says America must face reality and end its reliance on foreign oil. And he's funding a $58 million campaign to convince America.

T. BOONE PICKENS COMMERCIAL: Did you know, back in 1970 we imported 24% of our oil, today it is almost 70% and climbing every minute. Over 700 billion dollars are leaving this country to foreign nations every year. Four times the cost of the Iraqi war.

The ads are already drawing attention, and Pickens has met with both presidential candidates in recent weeks to discuss his energy proposal.

T. BOONE PICKENS: I want all American resources to be used - and I have only one enemy, and that is foreign oil. I've got to get the foreign oil, $700 billion figure down, and I've got to get the 70% figure down. So I am going to call on all resources we have in this country, and natural gas is going to do the heavy lifting for us.

According to T. Boone Pickens, domestic oil reserves, like those in North Dakota, will only ever produce a fraction of what the US needs each day.

T. BOONE PICKENS: The Baakan is, you may have, I think I saw 4 billion barrels of reserve. 4 billion, it doesn’t, we are using so much oil in the country every day that 4 billion helps, no question, but you can't drill your way out.

If Pickens is right, North Dakota is still perfectly placed to capitalise on alternative energies. As it happens, its plains lie in one of the world's strongest wind corridors.

KENTON ONSTAD: Energy has really taken over North Dakota. We're the Saudi Arabia of wind. Now they are saying we are the Saudi Arabia of oil, and those kind of resources. We have a huge coal resource here in North Dakota, so we see a lot of opportunity for us in the next years to come.

America's attempt to forge a new energy future looks set to bring plenty of change to North Dakota. And many more millionaires.

FRED EVANS: Isn't that something? It's pretty amazing. There's a lot of power down in there. Do you think that will last for 10 years?

REPORTER: I think you've got to hope it does.

FRED EVANS: We'll have to hope it does!




Reporter/Camera
GINNY STEIN

Editor
SLAVICA GAJIC
MICAH MCGOWN

Producer
AARON THOMAS

Original Music composed by
VICKI HANSEN

 

 

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