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Gordon Levang, 95, a retired farmer, says oil has been found on his family’s farm outside of Watford City, N.D., in all three oil booms.

From withered to wealthy

Oil boom enriches North Dakota towns, but new issues arise

Associated Press
New modular homes are seen behind an old house, right, in Grenora, N.D. Not so long ago, small towns in North Dakota were slowly dying, but a new oil boom has changed all that.

– When Brent Sanford graduated high school nearly 25 years ago, his tiny prairie town seemed to be withering away. Storefronts were shuttered, senior classes shrinking, families packing up and moving out. He joined the exodus.

But he kept looking for a way to return. He followed his town’s struggles from afar, getting updates from his father and subscribing to the local weekly newspaper. He’d read about plans to lure businesses to Watford City, but the results were discouraging.

“It was sad to see,” Sanford said. “They were trying to get things to happen … but you couldn’t force people to live here. There had to be a draw. There had to be a reason.”

Watford City now has a reason: Billions of dollars of oil in the shale beneath the ground.

This town suddenly finds itself at the epicenter of the Bakken oil boom. A tidal wave of oil money has erased the dusty, forlorn crossroads that once stood here and replaced it with a bustling community.

As Watford City marks its 100th anniversary this year, it stands astride a county where more than 8 million barrels of oil – nearly 300,000 a day – were pumped out of the shale in February. McKenzie County is the top oil producer in the state.

Oil already has transformed the landscape. Construction cranes tower in the sky. Houses and hotels are proliferating. Trucks rumble along Highway 85, creating bumper-to-bumper traffic. Tongues of flame flare from new wells. Help wanted notices beckon from billboards and roadside signs. And the free-flowing cash has drawn investors from as far away as China and France.

“I don’t know how else to say it, but it’s mind-boggling to see,” said Sanford, Watford City’s mayor. “It seems very surreal most of the time. We don’t have a choice but to keep up with it and try to stay ahead of it. … It’s like all those chances we were looking for in the mid-1990s and early 2000s just hit us with a fire hose.”

The Bakken bump – as it’s often called – has pumped new life and new opportunities into long-fading hamlets, such as Grenora, where temporary new homes have popped up and oil rigs whiz by at all hours. It’s too soon to know how much these towns will benefit and for how long. But probably no place illustrates the possibilities and growing pains better than Watford City.

“I’ve been around long enough to see both sides,” said Gene Veeder, McKenzie County’s economic development director. “The economic boom is fantastic. But the effort that it’s taken to deal with it is extraordinary. How do you build a city that’s grown this fast in such a short period of time? How do you come up with a financial plan to do justice to the people moving here?”

It’s a question he never could have imagined during those desperate days when he scrambled to find tenants for 14 empty storefronts along Main Street. Back then, Veeder touted Watford City’s tranquility, cheap housing and low-cost labor – all gone now. But there were few takers.

“Fifteen years ago, we couldn’t get people to look this way,” he said. “Now everyone is looking … and we need to find a way to serve them.”

Town officials are trying: They’ve expanded the sewer and water systems for a mushrooming population that could reach 17,000 by 2017 – 10 times the 2010 census.

They’ve offered subsidized housing to public workers, such as police officers and teachers, who can’t afford soaring housing costs: Monthly rent for a two-bedroom apartment has spiked from $500 to $2,000 in the last three years.

They’ve hired extra police to deal with rising numbers of calls and increasing crime. And they’ve issued building permits at a record pace. By fall, there will be an additional 2,000 apartment units and 300 to 400 homes. A new high school, community center and hospital are planned.

By the end of 2014, there will be nine hotels. Not long ago, there was just one, and a seasonal motel.

Four churches also plan to expand, said Jeff Ruggles, pastor of CrossPoint Church, whose congregation has tripled since he arrived five years ago.

In the past two years, he says, he’s seen people struggle with financial problems, marriage troubles and the stresses of living in campers, working 90-hour weeks.

“I sit down and deal with people hurting and broken in ways that I’ve never seen before,” he said.

It’s not just new arrivals feeling the strain. Some longtime residents – especially older adults – who relished the peace and quiet of the past have left town, tired of traffic and long lines.

“You’ll see much more enthusiasm from someone who has moved here in the last five years than someone who has been here 40 years,” Veeder said.

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