North Dakota's Oil And Gas Sector: A $48.8 Billion Economic Power

North Dakota has seen more than $48.8 billion in revenue and over 63,000 jobs projected in the energy industry as the North Dakota oil and gas sector continues to drive the state's economy.

Those figures are according to a study highlighted this week by Governor Kelly Armstrong.

“The oil and natural gas industry continues to be a major force in North Dakota’s economy, benefiting communities across our great state,” Armstrong said. “Taxes and royalties paid by the industry support state and local investments in infrastructure, schools, communities, tax relief, and the Legacy Fund, among other areas.”

Based on the most recent statistics, North Dakota State University academics Dean Bangsund and Nancy Hodur examined the economic impact of oil and gas exploration, extraction, transportation, processing, and capital investments to the state in 2023. Every two years starting in 2005, similar research has been carried out.

The reading of the data suggests that while the industry supported an additional 33,730 jobs, nearly doubling the jobs attributed to the North Dakota oil and gas sector. Wages, salaries, and benefits were calculated at $5 billion, or around 10% of the total revenue generated by the energy industry.

That revenue number set an all-time high record at $48.8 billion, which was an increase of $6.2 billion over 2021 and over 30% of the state’s overall gross business volume.

“Nearly $49 billion is a huge number and shows how important this industry is to our state’s overall well-being,” said Bangsund, a research scientist in agribusiness and applied economics at NDSU.

Another recent research study done by the Western Dakota Energy Association (WDEA) and North Dakota Petroleum Foundation claims that tax collections from North Dakota's oil and natural gas sector from fiscal years 2008 through 2024 amount to $32 billion.

During that period, the government allocated $2.36 billion of the tax revenue for K-12 education, $1.75 billion for water and flood management initiatives, $5.9 billion for local communities and infrastructure, and over $1.24 billion for property tax relief. Oil and gas taxes totaling $8.5 billion also flowed into the Legacy Fund.

During the current legislative session, a bill that would have used the legacy fund to ensure every child attending schools in North Dakota would be guaranteed free lunches was shot down.

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The bill sought to use legacy fund earnings to pay for the lunch program, and carried an annual price tag of $150 million. Should the bill have been passed, the legacy fund would still have grown by over $500 million annually from interest.