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MDU Still Pursuing North Dakota Gas Pipeline Plans

A unit of Bismarck, ND-based MDU Resources Group said Thursday it is making progress on two new natural gas pipelines, with each dependent on unrelated market developments, to serve the Williston Basin and Bakken/Three Forks shale production in North Dakota.

The near-term project is contingent on CHS Inc. following through on its plans to build a nitrogen fertilizer plant in Spiritwood, ND.

The larger, longer-term pipeline to carry Bakken supplies to various markets to the east and south is still determining if there is enough shipper interest to move ahead, a MDU spokesperson told NGI's Shale Daily on Thursday.

An open season was recently completed on the larger 400 MMcf/d pipeline aimed at various interstate interconnections in Minnesota, the spokesperson said. Earlier this year, MDU CEO Dave Goodin said the company's WBI Energy pipeline-building unit was looking for "the beef," or sufficient market interest, in the proposed $650 million project (see Daily GPI, March 26).

"The open season ended some time ago, and we continue to have discussions with those who expressed interest during the open season as well as other potential customers. Our pipeline business expects to provide an update this fall but hasn't set a deadline."

Still, the largest capital project in MDU's 90-year history would be the proposed 375-mile Dakota Pipeline, for which a 120-day open season has now concluded.

Meanwhile, a WBI spokesperson told local news media on Wednesday that the company was in the planning and permitting process for building its proposed $120 million Wind Ridge Pipeline LLC project, although there is some doubt as to whether it will go ahead. While it is  contingent on CHS's plans, MDU had to begin the pre-filing process based on the timeline originally announced for the fertilizer plant, a spokesperson said.

The 95-mile, 16-inch diameter pipeline would transfer supplies from Northern Border Pipeline's major interstate line near Zeeland, ND, through four counties (Mcintosh, Logan, LaMoure and Stutsman) to the proposed CHS fertilizer plant.

In April CHS said plans for the multi-billion-dollar project, which has promised to help cut the increasing volumes of flared wellhead natural gas in North Dakota, were delayed indefinitely by the St. Paul, MN-based developer (see Shale Daily, April 2). There was no timeline for the project being restarted.

"Wind Ridge is unrelated to the [larger] pipeline," said the MDU spokesperson. The spokesperson reiterated that these two are the only pipelines WBI is currently looking at. In addition, he said, the energy construction unit is "pretty well focused" on completing the diesel refinery that it is building in western North Dakota. It is on schedule to begin operating late this year.

In addition, with a partner, WBI is building the $350 million Dakota Prairie Refinery, which is slated to begin operations late this year (see Shale Daily, Feb. 5). MDU executives have characterized the project as being 40% complete at the beginning of 2014. The diesel topping plant is built to refine 20,000 b/d of Bakken crude oil.

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