Officials: Progress made to ease ND gas flaring

BISMARCK, N.D. (AP) — The amount of natural gas that is torched and wasted daily by drillers in North Dakota's oil patch could heat more than 2,300 homes in the state for a year though progress is being made to better capture the commodity, a state regulator says.

"Natural gas is precious in North Dakota when it comes to heating so it is of great frustration the amount being flared," North Dakota Public Service Commissioner Kevin Cramer said. "I'm hoping that a year from now that will be dramatically decreased."

More than one-third of the gas produced in North Dakota is burned off as a byproduct of the state's escalating oil production, state Department of Mineral Resources statistics show.

The U.S. Energy Department's Energy Information Administration says less than 1 percent of natural gas is flared from oil fields nationwide, and less than 3 percent worldwide.

North Dakota oil production from January through November 2011 jumped 40 percent, to a record 510,000 barrels daily. Natural gas production increased 53 percent during that time, to a record 521,000 million cubic feet daily.

Alison Ritter, a spokeswoman for the state Department of Mineral Resources, said a record 34 percent of natural gas produced in the state is being burned off at present. She said the state could expect the percentage to drop by two-thirds with about $3 billion in infrastructure improvements that are planned in North Dakota to process natural gas and move it to market.

"We're hoping to get flaring down to around 10 percent in the next couple of years," she said. "There is always going to be some."

The agency estimates that by the end of this year, the state's natural gas processing capacity will be 1.1 billion cubic feet a day, or double the capacity in 2010.

Oneok Partners LP of Tulsa, Okla., announced this week that it finished construction of a gas processing plant near Watford City, in western North Dakota's McKenzie County. Company spokesman Brad Borror said the plant in time would process up to 100 million cubic feet of natural gas daily.

Oneok also is planning two additional plants in neighboring Williams County, each capable of processing 100 million cubic feet of natural gas daily. Borror said one of the plants is expected to be operational this year, while the other will start in early 2013.

The company already operates processing three natural gas plants in North Dakota and one Montana and is expanding its pipeline network to handle the three-plant expansion, pegged at $1.5 billion, Borror said.

The company will have the capacity to process about 400 million cubic feet of natural gas daily when the expansions are completed, Borror said.

Additionally, New York-based Hess Corp. is planning a $325 expansion of its natural gas plant in Tioga, in western North Dakota. The company said the project is slated to be completed by the end of 2012 and will increase the plant's natural gas process capacity from 100 million cubic feet daily to 250 million cubic feet.

The Hess plant was built three years after the company's predecessor, Amerada, Corp., first struck oil on a Tioga wheat farm in 1951.