ENID, Okla. —
Despite fewer oil lease contracts and last year’s departure of Continental Resources, Enid Regional Development Alliance Executive Director Brent Kisling is predicting unprecedented performance for the Enid market in the foreseeable future.
The pace of signing new oil field leases in the Mississippi Lime play peaked in 2011, with 12,540 new leases in the Oklahoma portion of the play, according to figures provided by ERDA.
That pace slowed in 2012 with 3,642 new leases, the lowest level since a 10-year low of 1,414 leases inked in 2009.
A majority of the active leases in the Mississippi Lime play are set to expire in 2014.
But, Kisling said a slowing pace of new leases doesn’t necessarily signal a slowing of the booming pace in Enid’s economic growth.
“I’m starting to get a little aggravated with the people who say this is all fixing to end, and the glory days of Enid are behind us,” Kisling said.
A city of diversity
He said the focus needed now isn’t on when or whether the oil boom will end, but rather on reaping its benefits.
“How do we capitalize on this now, to make sure there’s not a cliff at the end of this boom?” Kisling said.
The pace of the current boom likely will “plateau at some point,” but it will not necessarily bust like the last big boom in the early 1980s.
“The difference between this boom and the ’80s is these are horizontally fractured wells, which require a lot more ongoing service,” Kisling said. “The service companies that are coming to town now are going to have more of a presence here.”
He said the best of the economic impact from the oil and gas industry is yet to come.
“I think we have a new level of prosperity here,” Kisling said, “and we’re not to the plateau yet.”
Even the departure of Continental Resources has not slowed Enid’s economy, Kisling said.
“We hate it, that they’re gone, but we’re more-than managing in their absence,” he said. “We’re doing OK.”
He said Continental left Enid at the best possible time, during a strong local economy and before Continental grew too big for Enid to “grow” into the vacated jobs.
“If Continental had been bigger when they left, it would have been a lot harder on Enid,” Kisling said. “They probably couldn’t have chosen a better time to make the move. We’ve grown into the hole they left. There’s been plenty of employees and plenty of wealth come to town to fill that hole since last April.”
Kisling said companies like Wymer Brownlee, Triangle Insurance and Hiland Partners have been able to expand their businesses into space formerly occupied by Continental.
Kisling said Enid’s economy has continued to grow because it is not focused on one asset.
One of the local market’s increasing strengths lies in a growing retail diversity, Kisling said.
That retail diversity, paired with strong oil and gas activity, led Enid to unprecedented sales tax returns in 2012, after a record-breaking year in 2011.
Kisling said that performance bodes well for Enid’s potential to attract new retailers and continue to build on its growth.
“I’ve got to think more retail outlets are going to be looking at Enid,” Kisling said. “When you have an extra $100 million in retail sales in 2012 over 2011, you’re going to get some attention. I’ve got to think 2013 is going to be a big year for retail development in Enid.”
Kisling said the major challenge facing the region this year, and the one over which the city has least control, is the ongoing drought.
He said the continuing drought threatens the livelihood of agriculture producers and the grain storage and transport industry.
“If there’s no crops coming in, it hurts the economy for all of us,” Kisling said. “The availability of water could hamper our economic growth.”