Meridian Energy Group Inc. has entered into a preliminary agreement to secure 100% of Bakken crude oil feedstock for the operator’s grassroots 49,500-b/sd high-conversion Davis refinery to be built in Belfield, Billings County, ND, in the heart of southwestern North Dakota’s Bakken shale region (OGJ Online, Sept. 13, 2019; Dec. 5, 2018).
As part of the preliminary agreement—which includes essential terms of a final, detailed agreement—will provide the Davis refinery with a reliable, long-term supply of light, sweet crude feedstock sourced from Bakken shale on pricing terms that provide a strong foundation for the plant’s financial performance and business model, Meridian said.
The supplier—identified only as a major international company—also will benefit with securing a long-term customer for a substantial portion of its Bakken production by avoiding high costs of having to transport its crude output to remote refineries elsewhere in the country, according to Meridian.
Currently, Meridian continues to advance site preparation and grading at the Davis refinery site and is proceeding with the project’s final design, equipment fabrication, and procurement, with full construction to proceed as planned.
Previously scheduled for startup sometime in 2020, the Davis refinery, once in operation, will produce ultralow-sulfur diesel and premium gasoline from prolific crude feedstocks from the Bakken shale basin using advanced technologies intended to maximize operational efficiencies while minimizing environmental impacts (OGJ Online, Dec. 7, 2018).
Last year, the operator announced that it also plans to build a full-conversion, 60,000-b/sd refinery in Winkler County, Tex., in the heart of the Permian Basin, that will be permitted under classification as a synthetic minor source of air contaminants like the Davis refinery (OGJ Online, Feb. 11, 2019).
