Bakken briefs

Occidental plans to exit Bakken formation

Occidental Petroleum Corp. of Houston announced it will make $600 million net by selling all of its Bakken formation acreage, citing unprofitable North Dakota operations at current crude oil prices. The buyer's name was not disclosed during a third-quarter earnings call.

Previously, Reuters reported private equity fund Lime Rock Resources was the buyer. Upon being contacted by UOGR, Lime Rock Resources said it could not comment.

"With this $600 million we could run four to five rigs in the Permian for a year and generate more production than we would get out of the Bakken," said Stephen Chazen, Occidental Petroleum's chief executive officer and president. "We have made a strategic decision to exit the Willison basin."

During a third-quarter earnings call, Chazen said Occidental was spending more than 50% of its oil and gas budget on the Permian basin in West Texas.

North Dakota PUC OKs oil pipeline

The North Dakota Public Service Commission in October approved an application to build the NST Express LLC crude oil pipeline in McKenzie County. The pipeline would have maximum capacity of 100,000 b/d, and organizers expect it will help reduce truck traffic.

NST Express LLC, which is part of NorthStar Midstream of The Woodlands, Tex., plans to build the 23-mile, 12-in. pipeline, which is scheduled to be in service by late 2016. The project is estimated to cost $60-80 million.

"Everything was pretty straightforward so we were able to turn it around pretty quickly," PSC Commission Chair Julie Fedorchak said. The application was submitted in May.

Oil will be moved from a new gathering service called the NST Express Alexander facility about 9 miles north of Alexander to the NST Transload East Fairview facility less than 1 mile north of East Fairview. East Fairview is near the Montana state line.

The new Alexander facility is to include up to six pipeline interconnects, four offload skids for trucks, a pump station, and up to three crude storage tanks with each having a 50,000-bbl capacity.

Monitoring equipment also will be installed. A portion of the pipeline that's to go under the Yellowstone River would be at least 50 ft beneath the riverbed.

Halcon running two Williston basin rigs

Halcon Resources Corp. said Nov. 5 that it operated an average of 2 rigs in the Williston basin during the third quarter.

It spudded 13 wells and put 9 wells on stream in the Fort Berthold area during the third quarter.

Halcon participated in 34 non-operated wells with an average working interest of 1% in the 3 months ended Sept. 30. On average, operated Bakken and Three Forks wells put on stream during 2015 outperformed expectations, executives said.

Average drill times (surface spud to rig release) in the Fort Berthold area decreased to 15.8 days per well in the third quarter, which was 29% faster than the average drill times during the third quarter 2014. Halcon estimated completed well costs in the Fort Berthold area at about $6.8 million as of Nov. 5.

NGL pipeline in McKenzie County gets siting permit

The North Dakota Public Service Commission has approved a siting permit for a natural gas liquids pipeline to be built in McKenzie County by Oneok Bakken Pipeline LLC.

Oneok plans a 4-mile, 6-in. NGL pipeline. It also plans associated facilities in its Lonesome Creek Pipeline Project, which will have maximum capacity of 30,000 b/d. The pipeline will carry a mixture of ethane, propane, butanes, iso-butane mix, pentanes and natural gasoline produced at the Lonesome Creek gas plant, a 200 MMscfd processing plant scheduled to start operating in December.

The $6 million pipeline will run from the Lonesome Creek gas plant to a connecting point with Oneok's Garden Creek pipeline southwest of Arnegard.

Tioga LNG plant pays permit fee

North Dakota LNG LLC (NDLNG) paid a building permit fee to the city of Tioga to resume construction of a liquefied natural gas plant expansion in the Bakken.

The Tioga City Commission had issued a cease and desist order halting the Phase II construction, citing an unpaid $39,000 building permit fee for a plant expansion.

NDLNG has a contract with Hess Corp., which supplies the natural gas to the liquefaction plant. First-phase operations began in October 2014 with production capacity of 10,000 gal/d. The second phase is expected to increase capacity to 66,000-83,000 gal/day.

The plant converts gas into liquid fuel to be used for drilling and hydraulic fracturing, said NDLNG, which was co-founded by Prairie Companies and EverStream Energy Capital Management.

Continental to supply ethane to Badlands

Continental Resources Inc., Oklahoma City, agreed to a long-term contract to supply ethane to Badlands NGLs LLC' proposed polyethylene (PE) production plant to be built in North Dakota.

Badlands of Denver did not disclose terms of the contract or the volume of ethane that Continental committed to supply from its production operations in North Dakota's Williston basin.

But Badlands told OGJ that it has decided to expand the nameplate production capacity of the PE plant to a proposed 2 million tonnes/year from its originally planned 1.53 million-tpy capacity based upon continuing discussions with North Dakota and Western Canadian NGL-sourced ethane feedstock suppliers.

William Jeffry Gilliam, Badlands' chief executive officer, said in late September that a precise timeline for the project's completion has yet to be revealed. The PE plant is intended to process ethane available from the Williston basin, Badlands said in a 2014 release.