Oneok Partners Inc. (OKS) has decided to increase its investment in Bakken Shale to cater to the increasing demand from natural gas operators. The partnership will invest around $140 million to $160 million to build a 270-mile natural gas gathering system and relevant infrastructure in Divide County, North Dakota.
This new pipeline will be operational from the second half of 2013 and will collect natural gas produced from the operators in Bakken Shale and deliver the same to its 100 million cubic feet per day (MMcf/d) Stateline II natural gas processing facility in western Williams County, North Dakota. The new processing facility is scheduled to be operational from the first half of 2013.
This new pipeline will seamlessly sync with the existing infrastructural development initiatives undertaken by the partnership in Bakken Shale. Oneok Partners has already chalked out a plan to invest $1.5 billion to $1.8 billion in the development of natural gas gathering and processing and natural gas liquids (NGL) businesses, within the 2011 to 2014 time frame.
Bakken Shale runs through two Northern US states, North Dakota and Montana, and a portion of the shale of the falls in the Canadian territory. As per a US Geological Survey, Bakken Shale has 3.65 billion barrels of recoverable crude oil and 2.0 trillion cubic feet of gas and another 150 million barrels of natural gas liquids.
In March 2012, pipeline operator Plains All American Pipeline LP (PAA) initiated a project viability report for its proposed new crude oil pipeline from Baker to Billings, Montana. The pipeline will have an initial capacity to transport 50,000 barrels per day of light sweet crude oil.
We believe to reap the benefits of these vast resources of Bakken Shale, the operators are making strategic investments in the infrastructure projects. We also believe that Bakken Shale will play an important role to meet the ever increasing demand for fossil fuel.
Based in Tulsa, Oklahoma, ONEOK Partners is one of the largest publicly traded master limited partnerships and a leader in gathering, processing, storing and transporting natural gas in the United States. ONEOK Partners currently retains a Zacks #3 Rank, which translates into a short-term Hold rating.
