Top 10 U.S. Pipeline Project Kickoffs in Fourth Quarter: Regulatory Issues, Low Oil Prices Pose Challenges

Researched by Industrial Info Resources (Sugar Land, Texas)--Oil and natural gas prices have had loftier days, but that isn't stopping construction of energy pipelines across the U.S. Industrial Info is tracking 72 active U.S. oil and gas pipeline projects worth nearly $7.4 billion that are scheduled to kick off in the fourth quarter this year. But whether all of those projects proceed if low prices persist is unclear.

With projects worth a combined $1.7 billion, North Dakota is the top state for pipeline kickoffs in terms of value, followed by Texas with $1.6 billion and Kansas with $890 million.

Civil construction on the North Dakota portion of Enbridge Incorporated's (NYSE:ENB) (Calgary, Alberta) $2.6 billion Sandpiper crude oil pipeline could kick off in the fourth quarter. However, a new court action in neighboring Minnesota could put a snag in the project timetable. The 618-mile project would move light Bakken crude oil from Enbridge's Beaver Lodge Station, near Tioga, North Dakota, through Clearbrook, Minnesota, to an existing terminal in Superior, Wisconsin. Current plans call for the pipeline to start up in 2017. For related information, see January 14, 2014, article - Sandpiper Crude Oil Pipeline Project Gains Major Investor and Anchor Shipper.

However, the Minnesota Court of Appeals on Monday overturned approval of the project by the Minnesota Public Utility Commission. The court said an environmental impact statement on the pipeline must be completed before the regulatory agency can make a final decision on the project.

The North Dakota portion, valued at $1.2 billion, includes 330 miles of 24-inch diameter pipe to transport an estimated 225,000 barrels per day (BBL/d) of crude to the Minnesota border. The Sandpiper project is a joint venture by Enbridge and a subsidiary of Marathon Petroleum Corporation (NYSE:MPC) (Findlay, Ohio). For details on this project, see Industrial Info's project report.

In Texas, planning and scheduling is under way for the grassroot, $1 billion Midland NGL (natural gas liquids) Pipeline, a project by Energy Transfer Partners LP (NYSE:ETP) (Dallas, Texas) and its subsidiary, Regency Energy Partners (Dallas).

The Midland project is part of a planned, $1.5 billion-to-$1.8 billion expansion, including construction of 533 miles of pipeline to transport NGL from the Permian Basin to Mont Belvieu, Texas. A 24-inch-diameter pipe will transport 375,000 BBL/d from the Permian Basin to Bosque County. From there, a 30-inch pipeline will move 495,000 BBL/d to Mont Belvieu. Project completion is scheduled for fourth-quarter 2016. For details on this project, see Industrial Info's project report.

Energy Transfer Partners is also set to start civil construction on part of the Dakota Access Pipeline Project (DAPL), which will carry 450,000 BBL/d of Bakken crude from producers in North Dakota to Energy Transfer's terminal in Patoka, Illinois. The grassroot Redfield portion of the pipeline in South Dakota has a total investment value of $450 million. For details on this project, see Industrial Info's project report.

Also with a $450 million price tag is the grassroot Sharon Springs Crude Pipeline in Kansas, part of the Grand Mesa Pipeline Project by NGL Energy Partners LP (NYSE:NGL) (Tulsa, Oklahoma). The Grand Mesa project will move 130,000 BBL/d (expandable to 200,000 BBL/d) of crude oil roughly 550 miles from Weld County, Colorado, to NGL Energy Partners' terminal in Cushing, Oklahoma. Rimrock Midstream LLC (Plano, Texas) is the constructor and operator. Completion is set for third-quarter 2016. For details on this project, see Industrial Info's project report. For related information, see August 11, 2015, article - NGL Energy Partners Strengthens Ties with Meritage in Power River Basin, Rimrock on Grand Mesa Pipeline.

Other big-ticket pipeline projects with fourth-quarter 2015 kickoffs include:

• $400 million: Magellan Midstream Partners LP's (NYSE:MMP) (Tulsa, Oklahoma) Wallace Grassroot Saddlehorn Crude Oil Pipeline in Kansas
  For details on this project, see Industrial Info's project report. For related information, see June 24, 2015, article - Planned Saddlehorn Crude Oil Pipeline to Add 50-Mile Segment.
• $350 million: Energy Transfer Partners' Johnsons Corner Grassroot Dakota Access DAPL Crude Oil Pipeline in North Dakota
  For details on this project, see Industrial Info's project report.
• $320 million: Rimrock Midstream's Lucerne Grassroot Grand Mesa Crude Oil Pipeline in Colorado
  For details on this project, see Industrial Info's project report.
• $220 million: Magellan Midstream Partners LP's Platteville Grassroot Saddlehorn Crude Oil Pipeline in Colorado
  For details on this project, see Industrial Info's project report.
• $200 million: Energy Transfer Partners' Cambridge Grassroot Dakota Access DAPL Crude Oil Pipeline in Iowa
  For details on this project, see Industrial Info's project report.
• $175 million: Energy Transfer Partners' Patoka Grassroot Dakota Access DAPL Crude Oil Pipeline in Illinois
  For details on this project, see Industrial Info's project report.

Industrial Info is tracking fourth-quarter kickoffs for 41 pipeline projects, worth $4.7 billion, which are in the engineering phase; and 31 projects, worth $2.7 billion, that are in the planning phases, where a variety of factors could still alter their outcome.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.