ONEOK Completes Multibillion-Dollar Projects On Time, On Budget

May 2013, Vol. 240, No. 5

ONEOK Partners, L.P. has completed three projects that are part of its previously announced $4.7-5.3 billion growth program through 2015, including:

• The Bakken NGL Pipeline that transports unfractionated natural gas liquids (NGLs) from the Bakken Shale and Three Forks formations in the Williston Basin to the partnership’s 50%-owned Overland Pass Pipeline, a 760-mile NGL pipeline extending from southern Wyoming to Conway, KS;
• The Stateline II natural gas processing facility in western Williams County, ND; and
• An ethane header pipeline that creates a new point of interconnection between the partnership’s Mont Belvieu, TX NGL fractionation assets and several petrochemical customers.
“These investments demonstrate our ongoing commitment to build the necessary natural gas and NGL infrastructure to better serve our producers and customers,” said Terry K. Spencer, president of ONEOK Partners. “We completed each of these projects on time and on budget, and the assets now are delivering essential services to our producers and customers.”

Bakken NGL Pipeline

The Bakken NGL Pipeline is a $450-550 million, 600-mile pipeline with the capacity to transport 60,000 bpd of unfractionated NGLs from ONEOK Partners’ natural gas processing plants and from third-party natural gas processing plants in the Williston Basin to an interconnection with the partnership’s 50%-owned Overland Pass Pipeline in northern Colorado. The NGL volumes are then delivered to ONEOK Partners’ Mid-Continent NGL fractionation and storage facilities in central Kansas.

“The Bakken NGL Pipeline is the first pipeline to transport natural gas liquids from the Williston Basin to NGL fractionation and storage infrastructure in the Mid-Continent and Texas Gulf Coast,” Spencer said. “This project and our continued investments in the Williston Basin reflect our commitment to provide producers with the essential NGL infrastructure needed as they continue to develop the Bakken Shale and Three Forks formations.”

In July 2012, the partnership announced plans to invest approximately $100 million to install additional pump stations on the Bakken NGL Pipeline, which will increase its capacity to 135,000 bpd from 60,000 bpd. This expansion is expected to be completed in the third quarter 2014.

Processing Facility Completed
ONEOK Partners has begun operating its new $135-150 million, 100 (MMcf/d natural gas processing facility in western Williams County in North Dakota– the Stateline II plant. The Stateline II plant is the third new natural gas processing facility that ONEOK Partners has completed in the Williston Basin since late 2011, joining the Garden Creekand Stateline I plants that are now processing natural gas and increasing its processing capacity in the region to 390 MMcf/d from 90 MMcf/d in 2011.

“The completion of Stateline II, along with our other two plants and associated infrastructure that are operational, will reduce the flaring of natural gas in the region, enabling producers to deliver natural gas to customers and improve the environment,” Spencer added.

The partnership previously announced that it will invest $1.7-1.9 billion for natural gas gathering and processing projects in the Williston Basin from 2011 through 2015, including the Garden Creek II and III plants in eastern McKenzie, ND which are expected to be in service in the third quarter 2014 and the first quarter 2015, respectively, and will increase the partnership’s natural gas processing capacity in the region to 590 MMcf/d.

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 5,000 miles and acreage dedications of 3.1 million acres.

Ethane Header Pipeline
ONEOK Partners also completed a 12-inch ethane header pipeline that creates a new point of interconnection between the partnership’s Mont Belvieu NGL fractionation assets and several petrochemical customers. The $23 million pipeline is backed by contractual commitments with several petrochemical companies. The new pipeline is capable of transporting 400,000 bpd of purity ethane from the partnership’s 80%-owned, 160,000-bpd MB-1 fractionator; the partnership’s two 100%-owned, 75,000-bpd MB-2 and MB-3 fractionators that are under construction and scheduled for completion in the third quarter 2013 and the fourth quarter 2014, respectively; and the partnership’s previously announced new E/P splitter that has the capacity to produce 32,000 bpd of purity ethane and 8,000 bpd of propane and is expected to be in service during the second quarter 2014.

“This header pipeline will allow us to meet the growing needs of our petrochemical customers in the area by providing them with direct access to purity ethane supply,” said Spencer. “It also will improve our operational flexibility and reliability while providing increased fee-based revenues to the partnership.”

The partnership has a $2 billion-plus backlog of unannounced growth projects that it continues to evaluate. Additional projects included in this backlog will be announced when sufficient supply commitments are completed.

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