BISMARCK, N.D., Jan. 7 (UPI) -- If low oil prices threaten North Dakota spending plans, the state's governor said he had confidence lawmakers would take measured steps to cope.
North Dakota Gov. Jack Dalrymple delivered his State of the State address late Tuesday, announcing plans to invest roughly $2.7 billion in state counties behind the oil boom in the state.
"I have recommended increasing the state's support during the upcoming biennium by another $1 billion," he said.
North Dakota's economy grew in 2013 faster than any other U.S. state in terms of real growth in gross domestic product. The U.S. Commerce Department said in a state-by-state review North Dakota can credit the extractive industries for a sizable portion of its 9.7 percent growth rate in real GDP.
Oil prices have dropped to the point that some drillers may no longer find it profitable to keep moving forward and several major international energy companies have trimmed their investment forecasts as a result.
Prices have declined dramatically since a late November decision by members of the Organization of Petroleum Exporting Countries to keep production levels static despite the bear market for crude oil. More oil on the market and a weak global economy suggest low prices should continue.
The North Dakota Industrial Commission in a report issued in December blamed low oil prices for a production decline of about 4,000 barrels per day from the previous month.
Dalrymple said conditions on the oil market have drawn attention to a state thriving because of the boom. Production, he said, may concentrate on core areas where operational costs are low.
"If adjustments to our spending plan are needed, I am confident our legislature will make prudent decisions based on the best available projections," he said. "In the end, our growth may be slowed, but it will not stop."