Oneok to invest in Texas, North Dakota plants

By OGJ editors

Oneok Partners LP, Tulsa, will spend between $980 million to $1.1 billion through 2014 on several projects in southeastern Texas and North Dakota.

At Mont Belvieu, about 20 miles east of Houston, the company will build a 75,000 b/d NGL fractionator (MB-3), a 40,000 b/d ethane-propane splitter, and associated systems for both.

In North Dakota, Oneok will build a 100 MMcfd gas processing plant (Garden Creek II) and related systems in eastern McKenzie County, ND, in the Bakken shale in the Williston basin. It will also increase capacity on its Bakken NGL pipeline to 135,000 b/d from 60,000 b/d.

Oneok said supply commitments for the expanded pipeline and fractionator are “in various stages of negotiation and will be anchored” by NGL production from the company’s gas processing plants and third-party processors. The Garden Creek II plant will be supported by “acreage dedications,” it said.

Mont Belvieu

The MB-3 fractionator, which will cost $375-415 million and be Oneok’s third fractionator in Mont Belvieu, will be in service during fourth-quarter 2014. It will supplement the company’s 80%-owned, 160,000 b/d MB-1 fractionator, as well as its wholly owned, 75,000 b/d MB-2 fractionator, the latter of which still under construction and set to begin operating in mid-2013 (OGJ, May 7, 2012, p. 88).

This investment also includes $150-160 million to expand Oneok's Mont Belvieu NGL storage, existing Oklahoma NGL gathering, and existing Arbuckle and Sterling II pipelines.

Oneok Partners owns an NGL system in the Midcontinent and Gulf Coast, including fractionators and storage in Mont Belvieu; Bushton, Conway, and Hutchinson, Kan.; and Medford, Okla. It also owns interstate NGL distribution pipelines between Conway and Mont Belvieu and NGL and refined petroleum products distribution pipelines that connect its Midcontinent NGL infrastructure to Midwest markets, including Chicago.

Oneok is currently spending $610-810 million to build a 570-mile, 16-in. NGL pipeline (Sterling III) that is to be completed in late 2013 (OGJ, Apr. 7, 2012, p. 104). It will move either unfractionated NGLs or NGL purity products to the Texas Gulf Coast from Midcontinent, with an initial capacity of 193,000 b/d and the ability to be expanded to 250,000 b/d. The company will reconfigure its existing Sterling I and II NGL distribution pipelines to transport either unfractionated NGLs or NGL purity products.

Oneok will invest about $45 million to install a 40,000 b/d E-P splitter at its Mont Belvieu storage to split E-P mix into purity ethane for petrochemical customers. The splitter will be able to produce 32,000 b/d of purity ethane and 8,000 b/d of propane and is to be in service in second-quarter 2014.

North Dakota

The Garden Creek II plant, including expansions and upgrades to its existing gas gathering and compression, will cost $310-345 million and be in service in third-quarter 2014. The plant will sit adjacent Oneok’s existing Garden Creek gas plant, completed in December 2011 (OGJ Online, Jan. 10, 2012).

The announcement of the Garden Creek II plant and related infrastructure increases Oneok’s Bakken-related investments to $3.6-4.2 billion for natural gas, NGL, and crude oil-related infrastructure out to 2015, said Pierce H. Norton, executive vice-president and chief operating officer of Oneok Partners.

The company’s previously announced Stateline I and Stateline II gas plants are to be in service this quarter and first-half 2013, respectively (OGJ, May 7, 2012, p. 88). When completed, the combined gas processing capacities of the Garden Creek II plant, the Stateline I and II plants, and existing Garden Creek and Grasslands gas plants will be 490 MMcfd in the Williston basin.

Oneok also will invest $100 million to install additional pump stations on the Bakken NGL pipeline. The expansion is to be completed in third-quarter 2014. The 525-615-mile Bakken NGL pipeline will move unfractionated NGLs produced from the Bakken shale to Oneok’s 50%-owned, 760-mile Overland Pass pipeline from southern Wyoming to Conway, Kan. The Bakken NGL pipeline, currently under construction, is to be in service during first-half 2013 (OGJ Online, July 27, 2010; May 7, 2012, p. 104).

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