American Oil and Gas Reporter - November 2018 - 106

ConventionCoverage: North Dakota Petroleum Council

Almost half of North Dakota's companies
say being unable to hire or retain workers
is hurting their growth, North Dakota
Department of Labor and Human Rights
Commissioner Michelle Kommer tells
the North Dakota Petroleum Council.

and retain workers as something that impairs their growth; 48 percent of hiring
managers see wage demand and a limited
talent pool as a barrier for hiring workers."
Five years ago, during the initial
Bakken Shale boom, the state's search
for more workers was easier because of
a recession-boosted unemployment rate
in other states, Kommer told NDPC. But
today, more than half of all states have
unemployment rates below 4 percent.
Kommer suggested that companies
devote more time to strengthening relationships with current employees, arguing
that the costs of hiring new workers-including recruiting, training, loss of productivity from distracted coworkers and
disrupted customers-far exceeded the
price tag incurred by nurturing in-house
personnel.
A workforce development council in
which she is involved has been working
to understand the state's job challenges,
Kommer said, adding it had been conducting economic impact studies and
stakeholder interviews. The group was
scheduled to submit recommendations to
the governor on how North Dakota could
best address those challenges.

of a panel discussion on the state's oil
tax legacy fund, that fund now held $5.9
billion.
Brent Bogar, owner and president of
Jadestone Consulting, described how the
extraction tax, imposed in 1981 at 6.5
percent at the wellhead, was changed to
5.0 percent on Jan. 1, 2016. The gross
production tax was first levied in 1953 at
a 4.5 percent rate and boosted to 5.0 percent four years later. In addition to the
legacy infrastructure fund, he said tax
revenues supported North Dakota's outdoor heritage fund, abandoned well and
reclamation fund, the general fund, tax
relief, budget stabilization and other funds.
In 2015, state legislators approved
what was called the surge bill, a $1.1 billion package that constituted the largest
nonagency appropriations bill the legislature ever passed, Bogar said. "It supported infrastructure throughout the state,
primarily transportation infrastructure,"
he recalled.
Senate Majority Leader Rich Wardner,
R-Dickinson, noted that, in addition to
highways and other infrastructure projects,
oil revenues were spent to attract workers
to North Dakota, including projects to
improve the cities of Willison, Minot and
Dickinson.
"Those three hub cities are critical to
bringing in workforce. They have to have
the amenities to bring the workers into
the Williston Basin: they have to have
the educational system," he said. "When
you go to Williston, it's like a big industrial
park around the whole town. If forecasts

Building The Infrastructure
North Dakota dedicates 30 percent of
the revenue it collects from gross production and extraction taxes on oil wells
to a legacy fund for infrastructure projects.
According to Brady Pelton, NDPC's government affairs manager and moderator
106 THE AMERICAN OIL & GAS REPORTER

are right, Williston will get $58.4 million
over two years, Dickinson will get $26
million and Minot will receive $12 million.
If there is more money, they will get
more."
The state is supporting projects outside
the oil-producing areas, noted House Majority Leader Al Carlson, R-Fargo. He
said those efforts included improvements
to farm-to-market roads throughout the
state and its bigger cities.
Recognition
NDPC recognized two individuals and
three companies for their achievements
in North Dakota.
The association inducted Terry Kovacevich, a 37-year Marathon Oil Co.
employee and former NDPC chairman,
into its Hall of Fame. Since 1978, he has
served as operations manager, asset manager and regional vice president, and has
worked for the past 10 years in North
Dakota, leading Marathon's Bakken Shale
operations.
Scott Reid, of Nabors Drilling, received
the association's Distinguished Leader
Award. The award acknowledges members
of the industry for their efforts in educating
the public and supporting programs to
improve community relations.
During the annual convention, NDPC
also presented three Industry Achievement
awards:
· Denbury Onshore LLC was honored
with an Excellence in Safety award for
its Zero by Choice campaign, which gives
employees the ability to report indications

Participating in a panel discussion on North Dakota's legacy fund reinvestment plan are,
from left, Brent Bogar, owner and president of Jadestone Consulting; state Senate Majority
Leader Rich Wardner R-Dickinson; and state House Majority Leader Al Carlson R-Fargo.

American Oil and Gas Reporter - November 2018

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