When the Commerce Department released its report on state GDP growth last week, economically minimal North Dakota had the mightiest results. It’s 7.1% growth rate in 2010 was far higher than the No. 2 state in GDP growth (New York, with a finance-fueled 5.1%) and orders of magnitude greater than the national average of 2.6%. Moreover, the largest component of North Dakota’s growth derived from natural resources extraction.
Now, recent data from the Department of Energy shows that natural gas production in March reached its highest point since DOE’s Energy Information Administration began keeping records in 1980. Indeed, there has been a lot of natural gas drilling in North Dakota since the discovery of the huge Bakken Shale deposit in the western part of the state (and in Montana and Saskatchewan) and a state tax break on producers has ensured that most of the action has taken place on North Dakota’s side of the border.
The EIA data shows six years of sustained growth leading up to March’s all-time high of 2.4 trillion cubic feet in gas production — from a low of 1.87 trillion cubic feet in February 2005. The vast expansion has been made possible by advances in hydraulic fracturing, or “fracking,” a means of extracting natural gas that is safer and environmentally less hazardous than conventional drilling.