Oneok Partners L.P. (OKS: Quote) Monday revealed plans for a 1,300-mile oil pipeline to transport crude from the Bakken Shale in North Dakota to the crude-oil market hub in Cushing, Oklahoma.
Oneok Partners, the natural gas storage and transport subsidiary of ONEOK Inc. (OKE: Quote), intends to invest $1.5 billion to $1.8 billion for the pipeline, which would have a capacity of 200,000 barrels per day. The company said the pipeline's capacity might be increased based on supply commitments prior to construction.
In recent years, crude oil production in the Bakken Shale has increased rapidly, with oil companies scurrying to improve pipeline infrastructure in the region. Oil companies have also started investing heavily in the region lately.
Terry Spencer, ONEOK Partners president, said, "As producers continue to aggressively develop crude oil from wells in the Bakken Shale, more crude-oil pipeline takeaway capacity will be required. This proposed pipeline will provide producers with efficient and reliable transportation of their product directly to one of the largest crude-oil market hubs in the U.S."
The construction of the Bakken Crude Express Pipeline, which will carry light-sweet crude oil, is expected to begin late 2013 or early 2014. It will be completed by early 2015.
The proposed pipeline route is expected to parallel more than 80 percent of the partnership's existing and planned natural gas liquids pipelines, the company noted.
Oneok had previously indicated investments of $2.8 billion to $3.5 billion through 2014 in growth projects, which includes $1.6 billion to $2 billion in projects related to the Bakken Shale.
OKS is currently trading on the NYSE at $54.05, down 1.60%. OKE is currently trading at $80.75, down 0.43%, on a volume of 0.4 million shares on the NYSE .
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by RTT Staff Writer
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