McKenzie County Farmer - Latest News

Steve Hallstrom
Special to The Farmer

As news of the toppled Maduro regime in Venezuela dominated headlines this week, residents and energy industry officials across the Bakken are asking a familiar question -What does a shake-up in a foreign oil power mean for the rigs and taxpayers in McKenzie County?

To find out, I sat down with Ron Ness, President of the North Dakota Petroleum Council, on KTGO Radio. While the world watches the geopolitical fallout, Ness’s message to North Dakotans was one of grounded perspective and a reminder of just how significant our local production has become on the global stage.

Despite Venezuela’s storied history as an oil giant, Ness pointed out a startling reality -North Dakota currently has the upper hand in daily output.

"There are some fascinating statistics about Venezuela and here's the two or three things for your listeners to walk away from today is number one, North Dakota currently produces more oil than Venezuela. We produce about 1.2 million barrels a day, North Dakota only, and Venezuela produces about a million barrels of oil a day. But their oil reserves are substantial. They were pegged at about 300 billion barrels of recoverable oil."

While Venezuela claims massive reserves, North Dakota's production remains remarkably steady. Recent data shows the state maintaining approximately 1.15 million barrels per day as of early 2026, supported by more than 19,000 active wells, according to state data.

Ness argued that the U.S. move in Venezuela is less about an immediate oil grab and more about long-term national security and pushing back against foreign influence in the Western Hemisphere.

"Out of that million barrels a day that they produce every day, China exports 80 percent of that. So to me, this is totally just a play to make sure that China does not have a foothold in the Western Hemisphere in a large oil producing potential area like Venezuela. So, I think this is a political long-term strategy move for the U.S. and also the opportunity for critical mineral development in Venezuela."

Ness added that American expertise will be required if Venezuela is ever to return to its former glory.

"Estimates are that the infrastructure is so dilapidated in Venezuela, it could take a hundred billion dollars. President Trump is talking to the large international American oil companies in asking would it take for them to go back in there. I believe Chevron, who produces oil in North Dakota now, has activity in Venezuela."

While the political shift is significant, the current market remains difficult for North Dakota producers. As of early January 2026, WTI crude prices have been hovering near $57.00 per barrel, a price point that creates a "bearish" outlook for new exploration.

"I don't know that it has a significant impact on North Dakota oil, frankly," Ness admitted while acknowledging that lower pump prices are generally good for the everyday consumer. "From a North Dakota standpoint, of course, there's a happy medium because low oil prices in North Dakota means that our tax revenues are down, our job opportunities are going to decline, our economic drivers across the entire state are going to go down, potential to add additional tax relief. All of those things for investment are probably going to be in a tougher decision point a year from now when the legislature comes back in."

Ness emphasized that for North Dakota, which currently collects roughly $8 million a day in oil tax revenues, a healthy price is vital for state services. However, at today's prices, the incentive to drill new wells - which cost roughly $8 million each - is beginning to fade.

"Certainly, I don't think there's a whole lot of optimism for 2026. I think when you look at the market dynamics around supply and demand, there's just a lot of supply," Ness said. "We're seeing operators back off of their exploration plans. It costs you eight million dollars to drill a new well. Well, are you bullish about getting forty-seven, forty-eight-dollar oil because that's what you're getting. Is that going to provide a return on that investment? No. So you're probably going to back off a little bit."

Despite the current "bearish" market and the distractions in South America, Ness remains bullish on the long-term future of the Bakken, provided the state continues to innovate.

"Some of the estimates I saw yesterday, it would take five to 10 years after you get some stability in that country to really bring that infrastructure back in place. I thought for a long time that when we cracked the code on shale oil, that we had about a 20-year window on the world before the rest of the world catches up. And we've kind of seen that the rest of the world is now deploying some Bakken-type technology. And we've got to get to the next level of the Bakken - Bakken 2.0. We got to figure out how to get the next 15 percent of oil out of that rock. That's the next big thing. And nobody in the world has done it."

For the residents of McKenzie County, Ness’ offered his perspective on what he believes is at stake for the next generation.

"The state of North Dakota collects eight million dollars a day in oil tax revenues. I'm just going to let that sink in. Big number. So, it is a state issue for North Dakotans and we're all in this together. We've got to make it work because it helps help make life affordable for us in North Dakota. It helps us do the things that we need to do. But it also keeps our tax low and our opportunities for our young people high."

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