America's Oil Frontier

With David Folkenflik

Stories from North Dakota. Deep inside the boom-and-bust world of America’s oil frontier. We take a look at "Great American Outpost: Dreamers, Mavericks, and the Making of an Oil Frontier."

Maya Rao, Washington correspondent for the Minneapolis Star-Tribune writer and author of "Great American Outpost: Dreamers, Mavericks and the Making of an Oil Frontier." (@Mrao_Strib)

Russell Gold, senior energy reporter for the Wall Street Journal. (@russellgold)

Danny Witt, water trucker in North Dakota since 2011.

Excerpt from "American Outpost" by Maya Rao

Introduction

Past the abandoned shack that said great food fast and for sale, rows of trailers lay forsaken in the weeds. Laborers had run out of time to install the doors and windows in several dwellings, and rain seeped through the openings. Cement slabs marked parking spots that had no vehicles. The dining hall was locked; the boot scrubbers on the porch had no mud in their bristles. Federal authorities had evicted the tenants. A banner had begun to drag off the chain-link fence, the red lettering barely decipherable: great american lodge.

Once a symbol of prosperity in the North Dakota oilfield, the lodge had become a gallery of fortune gone to ruin. Investors from Hong Kong to Madrid were reeling from revelations that their money had vanished in a $62 million Ponzi scheme. The British developers had disappeared overseas. Only the squirrels remained, running along the tarp and pallets that lay scattered in the grass. I drove by several times a week for much of 2015, looking, to no avail, for the smallest change; eventually the lodge loomed as just another landmark fringed by weeds along the highway. A Colorado real estate broker who did business with the swindlers told me they could have done well enough without scamming. “But no!” he said. “Greed, greed, greed!”

Artifacts of dreams abandoned have long strewn North Dakota’s landscape: old farmsteads, shuttered schools, wood planks rotting in the prairie grass. The Northern Pacific Railway drove settlements along the tracks west of the Missouri River, but residents built too many towns, churches, farms, newspapers, and schools to support a society that never grew as populous as planned. Farmers struggled against blizzards and droughts and meager harvests. Some starved. Many fled. Half of North Dakota’s communities were losing people by the 1930s, when the state’s population peaked at nearly 681,000. Citizens clustered in the cities of Bismarck, Grand Forks, and Fargo. The western edge of the state faded into earthen bones as the young left for better prospects and the old died off. Loss and despair vexed the buttes and grasslands; it brooded in the savage emptiness and the derelictions of wood and blotched glass.

North Dakota’s first oil discovery came in 1951 in the little town of Tioga, but the petroleum was difficult to extract profitably. A burst of oil development came in the 1980s, followed by a bust that stranded local governments with debt. By 2008, advances in hydraulic fracturing and horizontal drilling confirmed the largest domestic oil deposit since the discovery of the reserves under Prudhoe Bay, Alaska, four decades earlier. Billions of barrels of oil lay in the Bakken shale formation. Western North Dakota became an astonishing laboratory for the Darwinian, breakneck capitalism that one imagined was no longer possible in modern America, as outsiders engulfed the state to get rich, hide out, or start over. The state’s population grew for the first time in the lives of even its most elderly residents.

Observers often compared it to the California Gold Rush, when hordes of people flocked to an untrammeled terrain to make their fortune and, unwittingly, redefine the American dream from a steady grind of work and thrift to a gamble that favored the bold. The journey to the West Coast by ox- or mule-drawn wagon was long and arduous in the 1840s, as gold-seekers fought cholera, hostile Indians, and starvation. Voyages by sea could be perilous. In modern times, the way to prosperity was unimpeded. Adventurers drove, hitchhiked, or rode the train to the great land north. There was little of the speculative nature of past booms. Nobody wildcatted anymore—companies knew where the oil was and had the technology to extract it. Newcomers were almost guaranteed to find a job as long as they could pass a drug test, and if they couldn’t, those were easy enough to fake. North Dakota was again at the whims of exploitative outsiders, a half century after historian Elwyn Robinson claimed that the state’s remoteness had established it as a colonial hinterland dependent upon faraway markets.

Journalists from around the world came to North Dakota, often for just a few days. I was one of them, traveling from Minneapolis to the oilfield for a week in 2012. Yet most news stories could never capture the reality of it—the Bakken defied mainstream explanations. That place was an outpost of outcasts and dreamers and geniuses, an unending paradox in what it meant to be American, a phenomenon that called for nuanced reporting that captured the hopeful and the dark and the absurd. North Dakota! What a wild frontier. Who were all these people rushing in, and why? I tried to imagine the civilization they would build and its trajectory when the frenzy went away, the things the pioneers would leave behind. How might the natives regulate mass industrialization when they were so resistant to government intrusions, so protective of their own liberties? Observers always said this would be studied in history classes a century from now, and history demands a book.

I began going to North Dakota to pursue these inquiries more seriously in May 2014, stopping for gas near Fargo off Interstate 94, where there would invariably be some shifty-eyed man at the next pump over—probably just out on parole—and I would know, without either of us saying a word, that he was bound for the oil field six hours across the state. That look. Freedom, desperation, adventure, meth, money . . . it was perhaps the only time I would harbor a vague respect for a gas station ruffian. There was something so brave about heading out there that who one was mattered far less than that he was headed to the Bakken at all, and this was the truism that bound everyone.

It was such a novel place, so inscrutable to those who’d never been, that the oilfield remained a secondhand story even to inhabitants of the more populous eastern edge of the state. Farmers and barflies I met on the way out warned against going out there—not that they had ever been, but they’d heard all about it. Seen it in other ways. Take Casselton, the little town where an oil train derailed in 2013 causing an inferno so tremendous that people could feel the heat through their windshields a half mile away. The following year, oil began displacing the farmers’ crops on the tracks, delaying their transport of grain. “Warren Buffett can go screw himself,” several farmers told me, alluding to the billionaire’s ownership of the Burlington North–Santa Fe railroad. They already had a dim impression upon hearing of oil workers who’d make $17,000 in a month or two, fly to Las Vegas, then come home broke and eat ramen noodles. And another fellow from Casselton speaking of the supposed violence: “You wanted to go to a bar and have a beer—physical assault charges are up . . . and someone’s going to beat you up? You can go get a six-pack and sit home and watch Wheel of Fortune.”

One could travel there by taking the interstate all the way across North Dakota, then going up Highway 85, which formed the backbone of the oilfield and ran 1,479 miles from El Paso to the Canadian border. But to really understand the place, a traveler ought to make a series of northern and westerly turns from Jamestown and its iconic buffalo sculpture, into long and green hollows of feral quiet that ran hundreds of miles. Get out in some smudge of a town like Harvey to fill the tank again—shiver in the eyes of stillness that beamed over that endless expanse—retreat to the car as if to escape forces that would pull a human interloper into the fissures of the earth. Remember this upon arriving at the western flank of the state, where trucks and rigs and men ran roughshod and nature was the trespasser.

I spent seven weeks in the oilfield during 2014, including a stint cashiering at a truck stop for all of June, a month that would make world history for being the final peak of oil’s historic run trading at more than $100 a barrel. I lived in western North Dakota from April 2015 to January 2016 to conduct more in-depth research, finding that it was then, as the oilfield matured, that the missteps sown during the boom came to the fore. It was a story that would last for at least a generation, and over time I shifted my interest to investors and longtime residents of North Dakota, knowing they would live with the legacy far longer than the mass of transients who left after the easy profits dwindled.

North Dakota was always a trusting place, where a handshake was as good as a contract and nobody was a stranger—and yet this is a book threaded by mistrust and shaken faith. Even the most naïve among them became hardened to unscrupulous outsiders, as they discovered people were not who they seemed and grand promises danced away like mirages on the prairie. Landowners became leery that regulators would protect their interests against Big Oil, and migrants knew they could not count on the structures of mainstream society—from corporations to the government— to advance their lot. They had only themselves.

Many didn’t foresee the boom lasting much longer and hustled for a profit as fast as they could get it. Now was what mattered; later, an afterthought. Made-in-America exuberance abounded— and with it, a great deal of waste: illegally dumped oilfield brine, pipeline spills, trash scattered along the highway, the excesses of a boom revealed after the fall. Critics decried the transformation of their home into an industrial wasteland. Even the migrants were spoken about as refuse: oilfield trash, white trash, society’s castouts, the broken and disposable. This sense of things thrown away came into sharper relief after oil prices saw the worst rout since the eighties and empty oil trailers and tanks scattered like the old farmsteads, relics of different eras but the same American way.

This is not a tome on fracking. Nor should this be taken as a comprehensive account of the Bakken oilfield, a topic too vast and multifaceted for one book. This is a narrative, on-the-ground account of capitalism, industrialization, and rugged individualism in twenty-first-century America. This book is about what that Ponzi scheme symbolizes: the ways in which the largest oil rush in modern US history wrestled with ephemeral and lasting interests, scam and legitimacy, and the power and failings of free enterprise.

Excerpted from AMERICAN OUTPOST by Maya Rao, Republished with permission of PublicAffairs, a division of Hachette Book Group. Copyright © Maya Rao, 2018.

North Dakota was turned upside down by the innovation of fracking—drawing waves of people seeking new fortunes. A great new oil boom, unrivaled in decades had implications for the local economy, the landscape, the environment and Dakotans’ sense of themselves. Author Maya Rao captures the wild tale in her new book “Great American Outpost: Dreamers, Mavericks and the Making of An Oil Frontier.”

This hour, On Point: the Bakken oil fields.

- David Folkenflik