Marathon commits to Sandpiper pipe project
Marathon Petroleum Corp. has agreed to serve as the anchor shipper for an Enbridge Energy Partners-backed pipeline that is set to move crude from Beaver Lodge, ND, to Superior, Wis.
Marathon will fund 37.5% of the construction of the Sandpiper Project, which will become part of Enbridge Energy Partners' North Dakota System when it is completed.
The Sandpiper Project will expand and extend the Bakken takeaway capacity of the North Dakota System by 225,000 b/d to a total of 580,000 b/d. The pipeline is estimated to cost $2.6 billion and is targeted to become operational in early 2016.
In exchange for Marathon's commitment to participate in the open season for Sandpiper and its investment in this project, Marathon will earn a 27% interest in Enbridge Energy Partners' North Dakota System when Sandpiper goes into service. Marathon will also have the option of increasing its ownership interest to 30% through investments in future system improvements.
"With the growth in Bakken crude oil production, the Sandpiper Project will provide needed pipeline takeaway capacity for crude oil transportation out of the region," said Mike Palmer, senior vice-president at Enbridge.