When a boom is not a boon

 

Dark nights have long been a hallmark of the West's vast rural High Plains. But a 2010 nighttime satellite photo from the National Geophysical Data Center reveals a striking change in the arid, once-empty sweep of western North Dakota -- a smear of light that spreads far wider than any of the state's cities.

This is the nimbus of the Bakken oil boom. Over the last few years, the Bakken has become the hottest energy play in the United States. More oil rigs than in Saudi Arabia -- over 200 total, in fact, brilliantly lit and grinding throughout the night -- ply the ground in North Dakota. Millions of cubic feet of the natural gas produced alongside the oil each day are burned in flares visible from outer space.

Energy companies control more than 6,500 square miles of leases in the area -- larger than the collected landmass of the Hawaiian Islands. Last November, thanks largely to the Bakken, North Dakota's oil production surged past that of OPEC member Ecuador to more than half a million barrels per day, about 10 percent of overall U.S. production. The boom has brought a flood of outside workers, with a concomitant rise in strip-club revenue and the end of affordable housing. There's even a Montana-made microbrew called "Bakken Bock," potent enough at 8.4 percent alcohol that a night spent swilling it might prove almost as heady and disorienting as the boom itself.

The action has given North Dakota an enormous boost. Even as the Great Recession lingers elsewhere, its unemployment rate hovers around 3 percent and its government basks in annual billion-dollar budget surpluses.

Lost in the media frenzy over all this, until now, has been Fort Berthold Indian Reservation -- home to the Mandan, Hidatsa and Arikara tribes -- at the Bakken's center. Like many Indian nations, the Three Affiliated Tribes have endured more than their fair share of injustice and privation. The Bakken, at first, appeared to be an economic savior -- a chance for the people to achieve financial independence. But as Sierra Crane-Murdoch explores in this issue's cover story, that goal still hovers tauntingly out of reach. The byzantine federal bureaucracy that manages all tribal resources discouraged companies from developing Fort Berthold at first. Then, when the oil rush finally arrived, it caught the reservation woefully unprepared.

For though the influx of hundreds of millions of dollars has brought undeniable benefits, the tribes' long history of poverty and weak regulatory structure have sharpened the boom's negative effects on both the environment and the community, leaving the tribal government scrambling to catch up.

And since many tribal members hold no individual stake in the oil rights, the divide between the haves and have-nots has only deepened, sometimes leaving those who had little before with even less today. As this issue went to press, some of the reservation's poorest residents faced eviction. Their 45-lot trailer park had been sold to a developer who plans to build oil-worker housing.

Neil H Parsons
Neil H Parsons
Apr 16, 2012 12:13 PM
Hmmm, except for the piercing blue eyes, she sorta looks Indian with those earrings? ..Oh well, what I really want to ask is why the individual tribal members hold no stake? ..and if the answer is because they're not enrolled, it would only mean that tribal government will get their share to upgrade living standards for all!
Sarah Gilman
Sarah Gilman Subscriber
Apr 16, 2012 02:59 PM
Neil--
Nope, I'm not Native American, though my Missouri-born mom's got cousins who are Cherokee. To answer your real question, there are two kinds of tribal trust land on Fort Berthold, that held collectively by the tribe for all of its members and that held by individual alottees, who basically own property. Those tribal members who don't "own" land, and thus individual oil rights that they can sell to companies, don't receive royalty payments of any kind, or any bonus payments. The money earned on collectively held tribal acres can only reach these tribal members through the tribal government, which receives this money. Unfortunately, the government is pretty much spending all of this oil money simply keeping up with the impacts of the energy boom -- fixing roads, building houses to keep up with the boom-exacerbated shortage etc. -- rather than lifting the tribe's collective standard of living. I should say too that the tribal government is still $100 million in debt despite its earnings from the boom.

I hope that clears things up.

Cheers,
Sarah Gilman
Associate Editor
Neil H Parsons
Neil H Parsons
Apr 16, 2012 03:33 PM
Sarah--
Wow, one hundred million...! you mean that's all that it took for a plundered cultural entity to survive for a hundred years?!!!
Sarah Gilman
Sarah Gilman Subscriber
Apr 16, 2012 04:01 PM
Neil -- not even nearly all it took, I'm sure. Only the monetary accounting of recent expenditures, which funding from the BIA was apparently not adequate to cover -- hence the debt. I was mainly pointing out that the boom has not been the economic blessing that the MHA council had hoped for, for the myriad reasons Sierra lays out in her cover story. Who knows what the future holds, though. Thanks for reading with a careful eye.
--Sarah
Neil H Parsons
Neil H Parsons
Apr 16, 2012 07:17 PM
Sarah -- and thank you for the sincere and timely (or should I say sudden) empathy... for Native American peoples!