BELLE FOURCHE, S.D. — North Dakota's oil boom brings with it tremendous wealth and enormous problems — and both are coming to South Dakota, say organizers of a Thursday night event dubbed "Coming Down the Pipe."
About 600 people filled the Belle Fourche Area Community Center's auditorium to hear experts talk about the frenzy in North Dakota's oil patch that is already trickling south.
"We want people to understand the effect of development and the stress it puts on the community," said Lynn Hammerstrom, former president of First Interstate Bank who lives in Belle Fourche, a town in northwestern South Dakota with about 5,700 residents.
Hammerstrom said people need information because South Dakota has its own oil wells in counties such as Butte and Harding. The standing-room-only crowd listened to a panel of oil industry, infrastructure and economics experts, who gathered to answer questions about what residents should do as South Dakota inches toward tapping its own oil potential.
"Make sure you focus. It's all about planning," said Gene Veeder, a panel speaker and executive director of McKenzie County Job Development Authority who said constructing single-family units and affordable housing should be a priority.
Veeder should know: North Dakota's McKenzie County has seen rent prices steadily climb to averages of $1,500 to $2,000, he said.
"If you need 1,000 workers, you need to figure it out," he said. "I love the oil industry, but communities can say, 'We love you, but this is how we're going to do it.'"
But panelists said South Dakotans should embrace the possibilities. Truck drivers bring business, and communities will need parking, restaurants, truck stops and highway expansion — all of which will translate to more jobs, they said.
Already, U.S. 85 in South Dakota was expanded to a four-lane highway in December 2010 to handle heavier traffic.
Cal Klewin, executive director of the Theodore Roosevelt Expressway, described the truck stop on Highway 12 and U.S. 85 in Bowman, N.D., a town of fewer than 2,000 residents, where between 50 and 90 trucks stop each night.
Each morning, the buzz in town is about how many trucks had camped out, Klewin said.
The trucks are carrying hay, pumps, tanks, pipes and equipment, and their route extends as far south as Houston all the way to the border with Canada.
Jim LeMar, a Rapid City construction worker, was among the concerned audience members. He experienced the boom in Gillette, Wyo., in the 1970s when oil, coal and uranium production exploded.
"This is huge in comparison," he said of North Dakota's boom. The state has outpaced predictions, last month surpassing a milestone of half a million barrels of oil a day. It now accounts for about 10 percent of total U.S. crude oil production, up from just 1 percent in 2007. The oil patch has brought such wealth to North Dakota that its legislators are pondering proposals that other cash-strapped states would find ludicrous — such as one proposal to abolish property taxes.
LeMar said the construction industry is hurting with too few people pounding nails.
"The construction industry can't keep up. Most motels are booked three years straight, from the moment they opened," LeMar said.
Hammerstrom acknowledged that the possibilities are "exciting but scary too. You don't know what to expect until you live it."
Shawn Wenko, a panelist and assistant director of the Economic Development Office in Williston, N.D., said the boom has brought jobs in all skill levels. Though oil is the No. 1 industry, agriculture and retail contribute to the economy, he said. Other job openings are in emergency services, medicine, education and dentistry.
"We're seeing a boom of population while for generations or decades we saw a decline," Wenko said. "The younger generation is now moving back. In northwest North Dakota, your graduates from there left in the 1990s because there were no opportunities. Now, they're fighting to get back."