Growth in the Williston Basin in North Dakota is the key to ONEOK Partners expected ramp-up of natural gas and natural gas liquids (NGL) production in the second half this year, CEO Terry Spencer told financial analysts Wednesday.

Volumes on ONEOK's gathering systems in the Williston are expected to shoot up 39% and 27% in 2015 and 2016, respectively. Volumes on the system last year were 440 MMcf/d, compared to the estimated volume of 570 MMcf/d early in the second quarter this year, Spencer said.

Spencer said the company's confidence in its Williston Basin volume projections is driven by key operational statistics, including rig locations, new well connections, additional gas processing capacity, and flared gas inventories.

With the recent severe crude oil price declines, producers are concentrating on areas with high-initial production wells. These wells are roughly two to three times more productive than the ones in fringe areas of the basin, Spencer said, adding that ONEOK has seen about a 50% reduction of rig numbers in the basin.

In 1Q2015, ONEOK connected 300 new wells to its gathering system, and it plans on adding 700 in total. This will mean 160 MMcf/d of new natural gas production dedicated to ONEOK in 2015.

Spencer said more than 50 rigs will be working and the company will have more than 600 new well connects and 160 MMcf/d of new production connected to the ONEOK system in the Williston this year.

Even with recent progress in lowering volumes of flared gas in the Bakken (see Shale Daily, April 13), there is still about 150 MMcf/d of wellhead gas being flared, Spencer said. "We're already connected to the majority of wells that are flaring. This represents a growth market for  ONEOK's system.”

To help the company handle increased volumes of flared gas, ONEOK is planning to add six compressor stations this year with a collective addition of 77,000 hp (see Shale Daily, July 31, 2014). This will help add 300 MMcf/d capacity to the company's gas gathering system.

This and other upgrades this year will boost ONEOK's overall Williston processing capacity to more than 900 MMcf/d.

For 1Q2015, ONEOK Partners reported income from continuing operations of $60.9 million, compared to $91.7 million for the same period last year.