taoCMS™ Demo Site: Latest News


Home » Latest News »

Latest News

ONEOK to build new gas plant near Watford

Posted 11/27/13 (Wed)

By Neal A. Shipman
Farmer Editor

ONEOK Partners continues to expand its presence in the Bakken oil patch with its announcement last week that the Oklahoma-based energy company will be constructing its sixth, and largest, natural gas processing plant in western North Dakota.
The new Lonesome Creek plant, which will be located west of Watford City, is expected to cost approximately $320 to $390 million. When complete, the new plant will be the partnership’s largest natural gas processing plant in North Dakota and will increase the partnership’s total natural gas processing capacity in the state to approximately 800 MMcf/d. The Lonesome Creek plant and related infrastructure are expected to be completed by the end of 2015 and will be supported by acreage dedications from producers.
The new natural gas processing plant is part of the company’s plans to invest approximately $650 to $780 million between now and the second quarter 2016.
In addition to the Lonesome Creek plant, ONEOK Partners also expects to invest approximately $230 to $290 million for related expansions and upgrades to its existing natural gas gathering and compression infrastructure.
To accommodate NGL volumes produced from the new Lonesome Creek plant, ONEOK Partners expects to invest an additional $100 million to increase capacity on its Bakken NGL Pipeline, an approximately 600-mile pipeline completed in April 2013 that transports unfractionated NGLs produced in the Williston Basin to the partnership’s 50 percent-owned Overland Pass Pipeline.
This second expansion of the Bakken NGL Pipeline, which is expected to be complete during the first half of 2016, will increase its capacity to 160,000 bpd to accommodate NGL volumes from the new Lonesome Creek plant.
The Bakken NGL Pipeline is currently being expanded to 135,000 bpd from an original capacity of 60,000 bpd. This previously announced initial expansion is expected to be complete in the third quarter of 2014.
“Production in the Williston Basin continues to increase with no signs of leveling off or slowing,” said Terry K. Spencer, president, ONEOK Partners. “The new Lonesome Creek plant and related infrastructure will be well-positioned to capitalize on existing ONEOK Partners assets and provide producers in the area with essential natural gas processing capacity. These investments are another example of ONEOK Partners’ ongoing commitment to address natural gas gathering and processing constraints in the region and help reduce natural gas flaring in North Dakota.”
According to Spencer, the additional expansion of its Bakken NGL Pipeline will allow the company to transport additional natural gas liquids volumes from the Lonesome Creek plant to its Mid-Continent NGL infrastructure.
The additional natural gas processing plant, as well as ONEOK’s expansion of its natural gas liquids pipeline, which will reduce flaring of natural gas in western North Dakota earned the praise of North Dakota Governor Jack Dalrymple.
“We continue to work with private industry to expand our take-away capacity, to add value to the natural gas produced in western North Dakota and to reduce the flaring of this valuable energy resource,” states Dalrymple. “ONEOK Partners continues to be a strong partner in our continuing work. Because of their significant investments in our state, we are able to further reduce flaring and increase the market opportunities for North Dakota’s natural gas.”
With the new projects, ONEOK Partners will invest more than $3 billion in the Williston Basin through 2016.
According to U.S. Senator John Hoeven (R-N.D.), ONEOK’s expansion plans not only will reduce natural gas flaring in western North Dakota, but will also help realize the enormous potential of western North Dakota’s vast energy resources.
“The new facility will further help us to reduce flaring and capture the tremendous reserves of natural gas that accompany oil production, creating jobs and boosting our state’s economy,” states Hoeven, who serves on the U.S. Senate Energy Committee. “Add to the new processing plant, a second expansion of the company’s Bakken NGL Pipeline, and it’s clear that ONEOK’s commitment is helping us to realize the enormous potential of western North Dakota’s vast energy resources.”
ONEOK’s decision to expand in North Dakota, according to Hoeven, also reflects the importance of a good business climate and investing in the infrastructure necessary to harvest our energy resources in efficient and environmentally sound ways.
“I remain focused on working to realize similar projects, which can help our country achieve the long-sought, long-elusive goal of true North American energy security,” states Hoeven. “The Keystone XL Pipeline, for example, will create 42,000 jobs and carry 830,000 barrels of oil a day to U.S. refineries, including 100,000 from the Bakken. Projects like these create jobs, strengthen our economy, increase our standard of living and bolster our national security. North Dakota and ONEOK Partners are helping to make our goal a reality.”
ONEOK Partners is the largest independent operator of natural gas gathering and processing facilities in the Williston Basin, with a natural gas gathering system of more than 6,000 miles and more than three million acres where production is dedicated to its systems.