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2008-07-01 06:17:50
By JAMES MacPHERSON, Associated Press WriterMon Jun 30, 5:00 AM ET
Oscar Stohler was raised in a sod house in western North Dakota and ranched
there for nearly seven decades. He never gave much thought to what lay below
the grass that fattened his cattle.
When oilmen wanted to drill there last year, Stohler, 83, doubted oil would be
found two miles underground on his property. He even joked about it.
"I told them if they hit oil, I was going to buy a Cadillac convertible and put
those big horns on the front and wear a 10-gallon hat," Stohler recalled.
He still drives his old pickup and wears a mesh farm cap but it's by choice.
In less than a year, Stohler and his wife, Lorene, 82, have become millionaires
from the production of one well on their land near Dunn Center, a mile or so
from the sod home where Oscar grew up. A second well has begun producing on
their property and another is being drilled all aimed at the Bakken shale
formation, a rich deposit that the U.S. Geological Survey calls the largest
continuous oil accumulation it has ever assessed.
Landowners in western North Dakota have a much better chance of striking it
rich from oil than they do playing the lottery, say the Stohlers. Some of their
neighbors in the town of about 120, from bar tenders to Tupperware salespeople,
have become "overnight millionaires" from oil royalty payments.
"It's the easiest money we've ever made," said Lorene Stohler, who worked for
decades as a sales clerk at a small department store.
State and industry officials say North Dakota is on pace to set a state
oil-production record this year, surpassing the 52.6 million barrels produced
in 1984. A record number of drill rigs are piercing the prairie and North
Dakota has nearly 4,000 active oil wells.
The drilling frenzy has led companies to search for oil using horizontal
drilling beneath Parshall, a town of about 980 in Mountrail County, and under
Lake Sakakawea, 180-mile-long reservoir on the Missouri River.
"I have heard, anecdotally, that there is a millionaire a day being created in
North Dakota," said Ron Ness, president of the North Dakota Petroleum Council.
Kathy Strombeck, a state Tax Department analyst, said the number of "income
millionaires" in North Dakota is rising.
The number of taxpayers reporting adjusted gross income of more than $1 million
in North Dakota rose from 266 in 2005 to 388 in 2006, Strombeck said. The 2007
numbers won't be known until October, she said.
Bruce Gjovig, director of the University of North Dakota's Center for
Innovation, said his informal survey estimates the number of new millionaires
in Mountrail County, one of the biggest drilling areas of the Bakken, may be as
many as 2,000 or nearly a third of the county's population in the next
three to five years.
North Dakota's per capita income in 2007 was $36,846, ranking the state 30th in
the nation and up from 42nd in 1997, said Richard Rathge, the state Data Center
director and North Dakota demographer.
"The two main drivers are energy and agriculture income," Rathge said. The
increasing wealth in the state from oil should push the average annual wage in
North Dakota, he said.
The oil boom has spurred several "Jed Clampett-like" tales of ordinary folks
getting rich, said Tom Rolfstad, the economic development director for the city
of Williston.
Rolfstad said he hasn't spotted any Ferraris or Rolls Royces in town, though
several people can afford them now.
"I'm seeing a lot more big, shiny gas-guzzling pickups," he said.
Several homes that cost more than a million dollars also are being built in
Williston, he said. The community of about 12,500 people is perhaps best known
as the hometown of NBA coach Phil Jackson.
Most people "don't want people to know how much money they got and they don't
want to be tagged with being wealthy they want to be themselves," Rolfstad
said.
Oscar and Lorene Stohler said their newly found wealth hasn't changed them.
"We still know what tough times are," Oscar said. "We grew up in the Dirty
'30s."
"We put our kids through college without that oil money," Lorene said.
The couple moved a few miles east to Beulah and paid cash for their new home,
the first one they have owned. They have established trust accounts for their
four children.
Lorene said the only thriftless purchase was an automatic sprinkler system for
her flowers that surround the couple's new home. And Oscar bought a $1,000 ring
for his wife to celebrate their 60th wedding anniversary.
"We got enough now to buy new stuff," Lorene said, "but we like our old stuff."