Energy Independence: $1.8 Billion Oil Bakken Crude Express Pipeline Planned From North Dakota to Oklahoma

By Gary P Jackson

One of the few bright spots in America’s energy situation is the development of the Bakken Shale oil in North Dakota. The only problem is a lack of a pipeline to get this oil to the hungry markets. That’s about to change though.

From Bloomberg Businessweek:

Oneok Partners LP (OKS) (OKS) plans to build a $1.8 billion pipeline that will bring 200,000 barrels of crude a day from North Dakota’s Bakken Shale field to an oil-trading hub in Cushing, Oklahoma.

Construction of the 1,300-mile (2,100-kilometer) Bakken Crude Express pipeline will start as soon as 2013 and the system may be operating in early 2015, the Tulsa, Oklahoma-based partnership said in a statement today. The project would be Oneok Partners’ first oil pipeline and is estimated to cost $1.5 billion to $1.8 billion.

As producers continue to aggressively develop crude oil from wells in the Bakken Shale, more crude-oil pipeline takeaway capacity will be required,” Terry K. Spencer, Oneok Partners president, said in the statement.

The Bakken Shale formation, which stretches from Canada into North Dakota and Montana, holds an estimated 3.6 billion barrels of crude, according to the U.S. Energy Department. A lack of pipelines to bring the oil to refineries has caused crude prices in North Dakota, which had record output in January, to trade for as much as 30 percent less than West Texas Intermediate, the U.S. benchmark.

The proposed pipeline will run alongside existing Oneok Partners’ projects for more than 80 percent of the route and will be “well-positioned” to move crude from the Niobrara Shale in Colorado and Wyoming, according to the statement.

Transporting Oil

Production from the U.S. portion of the Williston Basin, which includes the Bakken, is projected to hit 1 million barrels a day in five years, which would increase the need for transportation, said Justin Kringstad, director of the North Dakota Pipeline Authority.

It’s going to be very interesting to see how industry shakes this out in the next several months,” Kringstad said in an interview.

Oneok joins at least three other companies that are building or considering pipelines to transport Bakken oil.

TransCanada Corp. (TRP)’s Keystone XL pipeline, which has been delayed because of environmental concerns in Nebraska, includes a link to the Bakken that would transport 100,000 barrels a day from the formation.
Pipeline Expansion

Enbridge Inc. (ENB) is reversing and expanding a pipeline in North Dakota that will allow it to transport 120,000 barrels a day by 2012, according to its website. Separately, the company is expanding its Flanagan pipeline from Chicago to Cushing, and is working with Enterprise Partners LP to reverse and expand the Seaway pipeline between Cushing and the Gulf Coast. The system will be able to move 850,000 barrels a day to the coast when completed in 2015.

Kinder Morgan Energy Partners LP (KMP) (KMP) is considering converting its Pony Express pipeline to carry 210,000 barrels of oil a day from Wyoming to Cushing, according to the company’s website.

Oneok Partners is investing as much as $2 billion in Bakken Shale gas projects through 2014, including a gathering system and processing facilities and a pipeline for gas liquids.

Read more here.

This is great news and a real success story.

According to Oil-Price.Net, a leading source for up to the minute oil pricing, there are an estimated 2 trillion barrels of oil locked up in shale deposits. This oil will go a long way towards making the United States energy independent.

This may sound like a fiction story but it is true! While total world resources of oil shale are conservatively estimated at 2.6 trillion barrels, US sits on close to two trillion barrels of crude. Possibly more than all the crude than was ever produced worldwide since petroleum age began.

The Green River Shale Formation encompassing the States of Colorado, Utah and Wyoming was first discovered in 1924. This famous shale formation covers tens of thousands of square miles. It is found in three different ancient lake basins. The layers of sediment in this formation stretch undisturbed for many miles.

Read much more here.

We use an estimated 18.8 million barrels of oil a day and produce around 9.1 million barrels a day. America is number 3 in world wide oil production.

Don’t let anyone tell you that America can’t become energy independent, and stay energy independent.

All we have to do is demand it.

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15 Comments

Filed under In The News, Politics

15 responses to “Energy Independence: $1.8 Billion Oil Bakken Crude Express Pipeline Planned From North Dakota to Oklahoma

  1. Aaron Allen

    I’ve had enuf of this obscene ripoff: We must declare ALL fuels ‘Strategic
    Materiel’ in North America [at least the US]–and NOT ‘speculative, churn-
    able goods’. Give the big banks and crooks a quarter to stop their games
    and get the wholly-unnecessary and undesirable 60-someodd cents out
    of every buck we surrender at the pump. Other reforms [stop advertising
    fuels, take down big overhead price signs, 24/7 canopy and lot lights left
    on, selling fuels to middlemen other than the actual, consuming, end-cus
    tomers] and quit tying fuels prices to ‘world supply/demand’ and every lit-
    tle burp in world politics. At MY ‘station’ [one of just enuf, licensed in my
    community] fuels cost $1.25-$1.50/USG, .25 for Sam, .10 for me and the
    current sales tax [7%] on the fuels ONLY. My ‘high sign’ shows the inter-
    national filler hose/nozzle only. No prices except on the pumps’ register/
    display. Choose 91-96UL [regular], 100-102UL [premium], No-sulphur/
    lower gell-temp. biodiesel/heat, CNG [from utility, on ‘industrial’, high-
    pressure ‘service-drop]. At a separate island, LPG [from local or regional
    source], 25-pounders [for barbeques] and 1 or 2 USG Kerosene in green
    plastic jugs…Free air for tires, water for HHO gas generators…How does
    this sound? With some of what a customer saves, s/he might buy some
    chow, drinks, other goodies from my store?..ALL states/commonwealths
    wud stop charging excise tax on fuels and adopt a nation-wide ‘Road-Use
    Fee’ of ____cents per mile [.621 of that per km], paid quarterly…Aaron
    Allen…

  2. Pingback: Obama Doing All He Can to Stop America From Being Energy Independent: Now Targeting Fracking | A Time For Choosing

  3. Aaron Allen

    [Aaron again]: Yes, we can become energy independent if we divorce our
    crude from the speculation pit. If we can get BRICK [Brazil/Russia/India/
    China/Korea&Japan] to follow suit and adopt CNG and HHO to cut 30-50% of their fuels-consumption…Get rid of unnecessary middlemen, chur-
    ning of crude, worn out centralized refineries, etc…Co-ops and small part-
    nerships grow/harvest/refine/distribute fuels, selling to the end-customers
    for 1.25-1.50, .25 for Sam’s roads/bridges/get riddah RR crossings, .10 for
    sales-site [station/convenience or general store/fuel oil truck/etc.], __%
    sales tax on fuel-only…Speculators spend a year in oilfields, on offshore
    rigs, other remedial ‘education’?..No more big signs, useless advertising
    of fuels, ‘gas wars’ and ‘.9 cents or 9/10 cents’ jive…No more 24/7 lights
    left on–even when station is closed or sun is shining down!…Aaron Allen…

    • Gary P Jackson

      Actually I have a former regulator on tape who claims speculation doesn’t effect the price of oil any where near what is claimed.

      When it’s all said and done, supply and demand is what effects prices most. We’re actually using less energy in the United States, but other nations, like China and India are growing.

      Back in 2008 Bush simply lifted a ban on offshore drilling, and Congress followed with legislation. Not a single new well was drilled, but in 6 months the price went from $4.25 to $1.70. Just the idea of new oil coming on line made a difference in the pricing.

      Of course, one can say speculators had something to do with that, as well.

      Few oil companies advertise their product any more, most are doing “feel good” ads, trying to change an image wrongly cast on them. We don’t see old fashioned price wars like we did in the 1960s and early 1970s. Wish those would come back!

      The free market, and opening up lands to exploration will cure what ails us.

  4. Aaron Allen

    Hi Gary: I respect your belief in markets but I still feel we are getting hosed by a ‘phony demand’ created by evil bankers and speculative
    traders who create and maintain conditions which screw Americans…
    Like enriched Plutonium, human blood, drinking water, and stem-cells
    [?], the price of fuels shud reflect the REAL costs of obtaing them–not
    an artificially-hiked ‘false-value’ which is imposed upon end-consumers: All of the other ‘costs’ [advertising, big signs, price manipulation, top-
    ping-up unnecesary [looser] retail stations, hundreds of flash-clickers
    nd thousands of expensive office sq-feet] shud be trimmed–bigtime…
    We didn’t put up with this stuff during ‘The War’ Why shud we now?
    Let’s ‘help’ the BRICK countries [and their surrounding neighbors] re-
    sist being hosed by Wall Street trolls thru teaching them how to ‘stretch’ fuels and make alternative ones out of trash, animal waste, scuzzy al-gae, thousands of miles of highway-hay, and of acres of ‘milkweed’ hydrocarbon plants–white juice, but same as dark crude] etc…Stop all
    of the wasted money spent on gloomy gas-news, ‘feel-good’ TV spots
    and ‘love Big Oil’ promotions…Get rid of as many middlemen and glad-
    handers who just rake in our dough…GOP types criticize Obama for al-
    lowing fuels-prices and taxes to climb to ‘European’ levels–making the
    US a ‘socialist’ nation…The guys in ‘robe and suits’ just love it!..Aaron Allen…

    • Gary P Jackson

      Oil companies make about 9 cents a gallon profit, per gallon, gas station owners about the same. Growing up, my dad owned several gas station, the profit margin was even less back then. This was back in the day of 35 cent gas.

      Gasoline isn’t that much of a profit center for retailers, it’s more of a draw. Convenience store use it to drag people in, who pay inflated prices for snacks and cold drinks. Back in the day, gas stations used it to draw customers in who would also have service work done there.

      Remember, oil is used for a lot more things than gasoline. Plastics, medicine, and many more uses.

      The real issue is taxes. State and federal gasoline taxes, depending on the state, can be as much as 75 cents per gallon. The government doesn’t explore for oil, it doesn’t drill for oil, it doesn’t refine the oil, and it doesn’t ship the oil. Government doesn’t have to maintain retail outlets, or any of the other things oil companies do, and yet, government makes almost 10 times the “profit” the oil companies do!

      If allowed to actually work, the free market will set the price of oil. The problem is, no one is allowing the markets to work.

  5. Aaron Allen

    Hi Gary: If markets [especially those artificially-manipulated by gamblers]
    won’t work why are we still paying high prices for fuel? Why shud we pay
    millions just to make a few crooks rich? If ‘they’ won’t change, let’s just
    change the fuels we need [and their sources, too]? If we do that, let’s not
    pay the ‘world’ prices any more! There are more of ‘us’ vs ‘them’ We shud
    go back to regional ‘source-to-pump’ supply–centralizing oil refining is
    just making it easier to rob us…Starting with rural areas, create environ-
    mentally-acceptable, low cost substitutes for gasoline and diesel/heat
    [motor fuel and heating oil]…Make highways CNG and LPG accessible.
    Big trucks and other vehicles can drive cross-country on these ‘home-
    grown’ fuels [add HHO gas generators to save even more]…Add these
    devices to ALL commercial vehicles and military machines also: Think
    of the impact a 30-50% reduction in fuels-cost cud make in our war thea-
    ters where the ‘real cost’ of a gallon of fuel costs several times what we
    pay at home? Think of the hundreds of specialists who ‘track’ the costs
    of fuels and expect us to pay them for bad news–I’d rather have them
    [Lundberg, OPIS, EIA, etc.] act as ‘good news watchdogs’…Also, let’s
    get the state excise tax changed to a road-use ‘fee’–the same in ALL
    states and territories…Once again, my ‘target price’ [may go down] is:
    $ 1.25 to $1.50 per USG–top-grade fuel only…
    .25 per USG–for Trust Fund–roads/bridges/remove RR crossings…
    .10 per USG–to station or heating oil delivery…
    .xx per USG–state sales tax–upon fuels cost only!..

    • Gary P Jackson

      Again, all we need to do is open the reserves. Trust me, history shows just the mention of opening new reserves causes the prices to go down. The free markets worked for nearly a century, it wasn’t until government started controlling supply, by stopping exploration IN THIS COUNTRY, that we started seeing this nonsense.

  6. Aaron Allen

    Hi Gary: I agree that the way things are now is not like they used to be.
    I join you in wishing the Govt. wud quit meddling with our US petro-sup-
    plies. I’m still for bigtime reform of distribution, marketing, advertising, etc.
    With the exception of a few fuels Brands, a lot of gasoline and diesel oil
    is whatever is ‘on the rack’ [can be any source just has to meet specs for
    the region it’s sold in–octane, ox-enrichment, low sulphur, etc.] How’s this:
    Local/regional non-Brand fuels are sold at my target prices. Big Brands
    can continue as-is, their prices going up/dn every time some event occurs
    overseas or when the commodities-ballers shoot a 3-pointer?..My dealers
    are happy–they don’t ‘buy’ my fuels or get only a few cents profit per re-
    fuelling…I help them set up with EPA and other safety-compliant island &
    storage equipment…If 2-3 small businesses want to have a ‘joint’ partner-
    ship station [explained previously] that’s okay, too. The little rural town
    which ‘lost’ it’s only station 15-20 years ago now has one back–kept filled
    up based upon its dispending-data [station automatically reports status to
    harvester/processor-refiner/distributor]. CNG and LPG is handled by NG
    utility and LPG-provider…I encourage my customers to install and use an
    HHO gas generator–saving them 30-50% of their fuels purchased…Do
    you think a present-day ‘plug in and pay up’ station can ‘compete’ with my
    ‘new way station’?..Suppose a large truckstop signed a contract with my
    outfit…How long cud ‘today’s’ truckstop ‘compete’ with that? I hope the Big
    Brands wake up and revise their business…If we cud cut the price tie-in
    with the holy ‘supply/demand/churn’, this might just work? Sure wud beat
    what we’re wasting money on now…Screw Wall Street!..Aaron Allen…

    • Gary P Jackson

      You hit on one of the reasons gas prices are not only hie, but can vary. Custom fuel blends. There are winter fuels, summer fuels, and these fuels are for different regions. Some cities require their own special blend. Most of this is all about “global warming” and nothing more.

      If we stop this nonsense a lot of it will take care of itself.

      I’m working on something about who owns Big Oil and their profit margins that you might find interesting.

  7. Aaron Allen

    Hi Gary: Sounds interesting [Who owns ‘Big Oil’ msg from you]…Pls add
    any info regarding the traders/gamblers/churners who are causing much
    of the bad news at the pumps…If there are ‘good inflators’ and ‘bad’ infla-
    tors’ in the overall manipulatons, pls tell us: It wudn’t bother me if most of
    the speculation/inflation activity came to a halt:.I wud give ‘them’ between
    60 and 90 days to get-out of the ‘marketplace’ that hoses us: If they wan-
    na play games with gasoline and diesel/heating oil, let them do it over-
    seas–in Euros, Sterling, and/or Yuan [PRC]…Let ‘them’ play with/against
    the OPECkers. Tell the ‘BRICK countries’ [Brazil, Russia, India, China, Korea&Japan] and their poorer ‘neighbors’ how to use Electric Vehicles
    [EV] and HHO gas generators to their benefit…The idea of these up-n-
    coming lands cutting 30%-50% of ‘fuels-demand’ shud help! Afghani vil-
    ages cud grow ‘hydrocarbon plants’ [similar to milkweeds] instead of
    opium? Cleaner, better fuels in a FEW, proper specs wud hopefully meet emissions, perform well [and cleanly] all year ’round…I honestly believe that the fuels ‘world’ [North America and Ferrin lands] is being milked-n-bilked bigtime: We don’t have a nice ‘light rail’ stop a block or so from our residences. Too many of our People MUST drive themselves, their kids,
    pets, groceries, home-n-garden supplies, yada…We shudn’t be forced to
    pay the inflated, unjustifiable prices demanded…Aaron Allen…

  8. Aaron Allen

    Hi Gary: The recent announcement of Delta Airline’s purchase of its own
    refinery and pipelines to locations where its own trucks can refuel their air-
    craft promises a great savings for them to obtain the jet fuel [distilate] they
    need, and sell the products they don’t need? There may be other such op-
    portunities for transportation carriers, construction, agricultural, light indus
    try, etc. to do this also…If proven HHO gas-blenders are added and they
    keep overhead down, this cud start the breakup of ‘the artificial market’–
    the unneeded and unethical price-milking syndrome that hurts the work-
    ingfolk…If airlines can save big bucks on fuel, they might adjust their jun-
    gle of fares [and hopefully not just give it all to their CEOs and high mgmt
    types…A similar break for government itself [fed, state, and local agen-
    cies, departments and public service corporations] cud make fleets of
    police cruisers, fire trucks, school busses, and military vehicles run better
    and way cheaper [think of M1A tanks, 6 & 8 wheeled trucks and combat
    units]…The USPS Grumman LLV [Long-Life Vehs] postal trucks [largest
    non-mil fleet in US]…All of the people returning to work [at lower wages]
    need a break on their pump-prices–glad I don’t punch the clock any more!
    All of the potential DIY refiners cud hire good oil people to operate their
    fuel operations–and sell all of the stuff [gasoline-to-asphalt] they don’t
    need much of?..Pls comment on these possibilities…Aaron Allen…

    • Gary P Jackson

      The free markets always win! The Delta plan is solid, and should allow them to remain competitive, that’s for sure.

  9. Pingback: 2 Trillion Barrels of American Oil: Why Wealthy Arab Oil Sheiks Are Funding Matt Damon’s Anti-Fracking Propaganda Film | A Time For Choosing

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