Importance of Industrial Sales to Rural Water

 "It is impossible to overstate the importance of industrial water sales to the Western Area Water Supply Project (WAWSP),” says Curtis Wilson, WAWSA Executive Director. “This public water project is unique in that it’s given the oil industry an opportunity to give back to the communities where they are profiting.”

 The WAWSP began in 2011 around the height of the oil activity in the Bakken. After a period of decline, the Bakken region is picking up again. According to the North Dakota Department of Mineral Resources, the state’s oil production hit a new record in December 2018 at 1.4 million barrels per day.

 In the chart below, the oil rig count in the Bakken is represented by the orange line while the blue illustrates WAWSA’s industrial water sales. It is easy to see the peak in 2015, then decline, and subsequent upswing that began in the second quarter of 2016. 

 

WAWSA Industrial Sales & Bakken Rig Count

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  The number of rigs has declined partially because drillings are nearly twice as efficient as they were during the early development of the Bakken. The state averages 24 wells per year, per rig currently, in comparison to 12 wells per year early on.

 “It is undeniable that without the Public-Private Partnership between the industry and this public water project, we could not have made the progress we’ve made to bring water to cities and rural residents across five counties,” says Wilson. “The revenue that WAWS brings in reduces domestic water rates and allows us to pay back loans from the State of North Dakota. These loans have funded crucial projects such as the expansion of the Williston Regional Water Treatment Plant and thousands of miles of pipeline, as well as water towers, pump stations and reservoirs.”

 Oil companies purchase water from WAWSA for the hydraulic fracturing process, as well as other drilling, completion, and well maintenance activities. The WAWSP’s business plan is unique because it sells the unused water capacity to the oil industry during the Bakken region’s population growth period to pay for the public water project.

 WAWSA provides temporary and permanent direct water pipeline connections for industrial use, as well as operating nine industrial water depots. There are currently no plans to increase the number of depots that WAWSA operates.