Oneok Inc. plans to construct additional infrastructure to handle growing natural gas and natural gas liquids (NGL) volumes from its U.S. operations, including a fractionator in Texas, a gas processing facility to serve the Williston Basin and an NGL pipeline extension and expansion in the Midcontinent.

The Tulsa-based company said the NGL projects would collectively cost $1.05 billion and are expected to be completed in 1Q2021, while the gas processing plant in North Dakota’s Williston Basin would cost $410 million and come online in 1Q2020.

Atop the list of projects announced Tuesday is MB-5, a 125,000 b/d fractionator and associated infrastructure at Mont Belvieu, already the country’s largest NGL complex near Houston, which is expected to cost about $750 million. The project is to include system expansions for future additional fractionation, storage and export capabilities at the complex.

Oneok said MB-5 is fully contracted and would increase total NGL fractionation capacity to more than 1 million b/d.

"Continued production growth across the basins Oneok serves requires additional NGL fractionation and natural gas processing capacity," said CEO Terry Spencer. "Producers are looking for increased connectivity with the Mont Belvieu market center, and Oneok is competitively positioned to provide it. Recently contracted volumes support the MB-5 fractionator project, with increasing NGL production providing an opportunity for Oneok to potentially build a future MB-6 fractionator in Mont Belvieu."

Oneok plans to extend its Arbuckle II NGL pipeline, which is under construction, further north to provide additional takeaway capacity in Oklahoma's STACK, aka the Sooner Trend of the Anadarko Basin, mostly in Canadian and Kingfisher counties. Additional NGL gathering infrastructure would allow access to fractionation capacity at Mont Belvieu for increasing volumes on the proposed Elk Creek Pipeline. The project is expected to cost about $240 million.

The company also plans to spend $60 million to expand Arbuckle II's capacity by 100,000 b/d with additional pump stations, increasing total capacity of the pipeline to 500,000 b/d. Oneok said more than 300,000 b/d of capacity is currently contracted.

In the Williston Basin, Oneok plans to build Demicks Lake II, a 200 MMcf/d gas processing facility, and related infrastructure in McKenzie County, ND. The company earlier this month announced plans to expand processing capacity at Demicks Lake I by 200 MMcf/d for $400 million.

"Additional natural gas gathering and processing capacity in the Williston Basin is critical to supporting record-setting crude oil and natural gas production in North Dakota and helping producers meet regional natural gas capture targets," Spencer said. "The previously announced 200 MMcf/d Demicks Lake I plant is expected to reach capacity soon after its expected completion in 4Q2019, increasing the need for the Demicks Lake II plant."

Oneok said the Demicks Lake II plant is supported by acreage dedications with primarily fee-based contracts, and both facilities are expected to contribute additional gas volumes to the Northern Border pipeline, in which Oneok owns a 50% stake. Following the project's completion, Oneok's Williston gas processing capacity is expected to increase to more than 1.4 Bcf/d.

The company first announced plans to build a gas processing facility at Demicks Lake in 2014, but scuttled plans to build it and two others in Oklahoma and Wyoming in 2015, citing depressed crude oil prices. At the time Demicks Lake was first proposed, the facility was expected to cost $515-670 million.