ONEOK Partners to build Bakken pipeline

ONEOK Partners, LP

Tulsa, Okla.-based ONEOK Partners, LP is entering the crude-oil transportation business with plans to invest $1.5 billion to $1.8 billion to build a 1,300-mile crude-oil pipeline from the Bakken shale in the Williston Basin in North Dakota to the Cushing, Okla., crude-oil market hub.

The Bakken Crude Express Pipeline will have the capacity to transport 200,000 barrels per day (bpd) of light-sweet crude oil. It is expected to parallel more than 80 percent of the partnership's existing and planned natural gas liquids pipelines, and also will be positioned to transport crude-oil production from the Niobrara shale in Colorado, Wyoming and western Nebraska. 

Construction is expected to begin in late 2013 or early 2014 and be completed by early 2015. 

"As producers continue to aggressively develop crude oil from wells in the Bakken shale, more crude-oil pipeline takeaway capacity will be required," said Terry K. Spencer, ONEOK Partners president. "It also represents our entry into the crude-oil transportation business and utilizes our existing core capabilities of transporting and storing natural gas, natural gas liquids and refined petroleum products.

"Many of the supply commitments under negotiation are with the same producers in the Williston Basin that we currently serve."

Other investments previously announced include projects related to the Bakken Shale that include the 500-mile NGL pipeline, the Bakken Pipeline, for $1.6 billion to $2 billion; a 270-mile natural gas gathering system and related infrastructure in Divide County, N.D.; and three 100 MMcf/d natural gas processing facilities – Garden Creek plant, Stateline I plant and Stateline II plant – and related infrastructure. The Garden Creek plant went into service in December 2011.

Additionally, the partnership has a $1 billion-plus backlog of unannounced projects that will be announced when sufficient supply commitments are completed.

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