Good Question: What Happens To North Dakota’s Oil?

MINNEAPOLIS (WCCO) — With gas prices rising some lawmakers are talking about increasing domestic production of oil as a possible solution. Those of us in Minnesota are looking at the success of oil exploration efforts in North Dakota and asking: What’s happening to all of North Dakota’s oil?

According to Justin Kringstead, director of the North Dakota Pipeline Authority, North Dakota is producing 530,000 barrels of oil every day. They have dreams of pumping 1 million.

About 6 percent of North Dakota’s oil goes to a pipeline in Canada, 10 percent stays within the state at its only refinery in Mandan. The rest, around 75 percent, goes to refineries around the U.S.

North Dakota’s oil goes to terminals in Clearbrook, Minn., Guernsey, Wyo., Cushing, Okla., and St. James, La., where oil is purchased by refineries in those areas.

But that oil isn’t having much of an impact on the global pricing market, Kringstead said.

“The crude oil market, the refined products market, those are global markets — on a much greater scale than what North Dakota is producing,” he said.

North Dakota’s 530,000 barrels a day is a drop compared to the 7.7 million barrels we import every day, according to Kringstead.

He said it’s difficult to know what happens to the gasoline after it’s been refined, but it’s generally believed that North Dakota’s oil ends up in the United States.

“The US as a whole is a net importer. The new oil out of North Dakota is helping offset other oil fields that may be declining,” Kringstead said.

“The U.S. is increasing,” he said. “North Dakota has been a part of that.”

More from Jason DeRusha
  • sue

    drill baby drill!!

  • Bill P

    If 6% goes to Canada, 10% stays in ND and 75% goes to refineries across the US the remaining 9% must go to line the politicians pockets.

  • mark Edwards

    Well, some of you don’t remember but, Pres. Nixion took off the cieling and floor controls on oil in the 70’s.
    At that time, we drilled and drilled all over Alaska and produced millions of barrals a day……
    whare has it all gone you say….
    BP owns 51% of the oil production in that site, so the oil is going to China and India and they are the highest bidders.

    • Steve

      I agree. Oil is going to emerging economies like China (with their sweat shops) and India (who now have a lot of those oversea jobs shipped there from USA)

  • William M Bauer

    Of course what you are not covering is the Clearbrook to Houston Ship Canal price difference for eqivalent grade crude. It is in parlance called the Obama spread. The Clearbrook price is substantially lower due to the Upper midwest pipleine bottleneck. Just as the Cushing price is lower than the Brent sea crude/Gulf coast oil price due to the lower midwest bottleneck. I have explored this subjected extensively on my Facebook wall. Please feel free to consult it. As for why prices are not lower in MN. It has to do with the refined products pipelines and that the Koch refinery does not have to compete with anyone substantial above the upper midwest bottleneck.
    William Monie Bauer, MD

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