MDU Resources Doubles Down on Bakken Shale Amid Growth

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Researched by Industrial Info Resources (Sugar Land, Texas)--Energy services provider MDU Resources Group Incorporated (Bismarck, North Dakota) cruised past concerns surrounding inflation and milder-than-normal weather to notch up a record $3.1 billion backlog in the second quarter, up 37% from the same period last year. As the company prepares to spin off its construction materials business so it can focus on regulated utilities and natural gas pipelines, it is building out its presence in the prosperous Bakken Shale. Industrial Info is tracking more than $1 billion worth of active projects involving MDU, the bulk of which are related to projects in the Bakken Shale.

Click on the image at right for a map detailing MDU's active projects across the U.S., from Industrial Info's Geolocator tool.

Dave Goodin, the chief executive officer of MDU, attributes the growth in the company's pipeline business to the North Bakken expansion that was placed into service earlier this year. "This project is well positioned in the Bakken and can be readily expanded in the future for forecasted natural gas production growth," Goodin said in a recent earnings-related conference call. "In addition to that opportunity, we're excited about the multiple pipeline expansion projects on the horizon such as the Wahpeton Expansion Project in Eastern North Dakota, which is expected to be in service in 2024, pending regulatory approval."

The 100-mile North Bakken expansion has capacity to transport 250 million cubic feet per day of natural gas from the Bakken production area in North Dakota, with the potential to be increased up to 625 million cubic feet per day through additional compression if needed. Subscribers to Industrial Info's Global Market Intelligence (GMI) Oil & Gas Project Database can click here for a list of detailed project reports related to the North Bakken expansion.

The Wahpeton Expansion Project is designed to transport up to 210 million standard cubic feet per day about 60 miles southward from Mapleton, North Dakota, to a new delivery station near Wahpeton, North Dakota, which sits on the border with Minnesota. Natural gas service also will be extended to Kindred, North Dakota, for the first time. Subscribers can learn more from a detailed project report.

The North Bakken and Wahpeton projects were managed by WBI Energy Incorporated, a subsidiary of MDU, which is gauging interest in a proposed pipeline from Tioga, North Dakota, to northern Minnesota. As currently envisioned, the 330-mile project would carry up to 600 million standard cubic feet per day of natural gas from the Bakken Shale to an interconnection with the existing Great Lakes Gas Transmission and Viking Gas Transmission pipelines near Minnesota's border with Manitoba.

The Tioga pipeline is in its earliest design phase, and plenty of factors could delay or alter projected spending. Subscribers can read detailed reports on the North Dakota and Minnesota phases of the project.

"We have a robust capital [spending] plan, with nearly $750 million planned here in 2022 and nearly $3.1 billion over the next five years," Goodin said in the earnings call. "These capital expenditures include opportunities such as the completion of the Heskett Station Unit 4 and other infrastructure development at the utility, expansion projects at the pipeline, and ongoing equipment replacements at our construction businesses."

MDU's utility business is at work on the $67 million addition of a natural gas combustion turbine at the R.M. Heskett Power Station in Mandan, North Dakota, which will generate 88 megawatts (MW). Historically a coal-burning plant, the Heskett Power Station stopped burning lignite earlier this year. Subscribers can learn more from Industrial Info's project report.

Earlier this week, MDU's board of directors unanimously approved a plan to separate MDU's wholly owned construction materials business, Knife River Corporation, from MDU Resources, resulting in two independent, publicly traded companies. Knife River is in the process of building an $18 million prestressed concrete plant in Newman Lake, Washington, which will replace an existing, 60-year-old facility and consolidate Knife River's operations in the area. Subscribers can learn more from Industrial Info's project report.

Subscribers to Industrial Info's GMI Project Database can click here for a full list of detailed reports for projects mentioned in this article, and click here for a full list of related plant profiles.

Subscribers can click here for a full list of reports for active projects from MDU.

Industrial Info Resources (IIR) is the world's leading provider of market intelligence across the upstream, midstream and downstream energy markets and all other major industrial markets. IIR's Global Market Intelligence Platform (GMI) supports our end-users across their core businesses, and helps them connect trends across multiple markets with access to real, qualified and validated project opportunities. Follow IIR on: LinkedIn.