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North Dakota Ponders Oil Gathering-to-Transmission Plan

North Dakota's Public Service Commission (PSC) has been asked to approve plans to convert a crude oil gathering pipeline into a crude transmission link into a Wyoming hub and other market interconnections.

Part of a private play owned by the family of Continental Resources LLC's billionaire CEO, Harold Hamm, Enid, OK-based Hiland Crude LLC proposes to add storage tanks, pumping stations and related facilities to its 197-mile eight-inch diameter crude gathering system to convert it to a 65,000 b/d transmission outlet from the Bakken to Guernsey, WY, and interconnection to the market hub at Cushing, OK.

"[Proposed] construction consists only of installation of storage tanks, pumping stations and related aboveground facilities," Hiland told the PSC in its filing earlier this year. "No new underground pipeline will be installed."

Hiland cited robust growth of production in the Bakken to justify the need for the project, projecting that the growth will continue unabated through 2025. North Dakota's production has more than doubled in the past three years, the company's application said.

"The purpose of the project is to provide 'midstream' transportation alternatives for the expanding volumes of crude oil produced in North Dakota," regulators were told.

Bakken crude goes to three possible demand points, Hiland told the PSC:

  • Tesoro's Mandan, ND, refinery;
  • Guernesy's southbound interconnection hub in Wyoming; and
  • A Clearbrook, MN, interconnection hub.

The existing gathering system was built in recent years in six segments, and with each of those segments, Hiland is proposing to do different things. Each segment has a major interconnection -- either pipeline or rail.

"The existing pipeline system is currently the only system capable of gathering crude oil from lease sites in Williams, McKenzie and Mountrail counties in North Dakota for connections to transmission pipelines that can transport crude oil to Gulf Coast refineries without using truck or rail transport," Hiland said.

The company told the PSC that its existing gathering system removed 481 trucks/day from the oil/gas landscape in the state, and the proposed expansion with storage and pumping promises to remove another 364 trucks, the company said.

ISSN © 2577-9877 | ISSN © 2158-8023

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