Updates
June 7, 2012: update from message board thread; from individual who worked on the project.
Original Post
MDU Resources subsidiary purchases interest in Bakken oil and natural gas midstream assets for $66 mln: through its wholly owned subsidiary, Bitter Creek Pipelines, LLC, announced an agreement purchasing a 50 percent undivided interest in Whiting Oil and Gas Corporation's natural gas and oil midstream assets near Belfield, N.D. in the Bakken area.Data points: the deal includes --
- Bitter Creed paid $66 million at closing; responsible for 60% of future CAPEX
- a newly constructed, state-of-the industry natural as processing plant and gathering system -- inlet processing capacity of 35 million cubic feet per day (35 MMcfd)
- plans to tie a natural gas residue line into the Williston Basin Interstate Pipeline Company (MDU)
- plans to build a crude oil gathering and storage terminal; pipeline to the Bridger Pipeline; oil terminal currently under construction; completion expected 3Q12; storage capacity of 20,000 bbls of oil
- Whiting will continue to operate the facilities
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Jungle art / fingerprint art from the younger granddaughter:
I really like this news and think it has more importance than presented. Gut feeling is sooo good. Its winner (Whiting) and old time area insider (MDU) teaming up. Something is happening...something big. I think they want to play serious ball.
ReplyDeleteI agree. I wanted to comment more on this announcement but this is not an investment site, so I held back.
ReplyDeleteBut in the comment area, I feel I can say a bit more.
Yes, I thought this was a huge story. I wasn't quite sure why Whiting did this, except for the cash necessary for these huge projects, but it is a perfect fit for MDU. It is interesting that this appears to be an investment-only deal for MDU because Whiting will continue to operate.
I don't own any shares in MDU but at one time it was one of my favorite investments and I always thought I would hold it forever. Then MDU seemed to have lost its mojo -- during the recession, and when they sold their assets to Oasis - that was a real downer.
I would like to re-invest in MDU as a long-term holding for my granddaughters, and when I saw this announcement it gave me hope for MDU getting its mojo back. Yes, I was thrilled to see this announcement. It makes sense for Bitter Creek Pipelines to have bought this, but all the same it was interesting it was not Fidelity. It served to remind investors that MDU is a true conglomerate with a lot of subsidiaries.
Thank you for taking time to comment. Yes, this is a huge announcement, more than I let on when I posted it.
Not sure that MDU does anything well. Sold hundreds of thousands a mineral rights cheap to OASIS? Kept the lesser mineral rights for themselves? Let ONEOK and Plains MLPs encroach on their natural territory. The investment above should be in an MLP, not as part of MDU. MDU has missed on all the decision points that would have created huge value. It should stick to being just a utility.
ReplyDelete"...should stick to being just a utility."
DeleteThat train left the station decades ago.
I have voiced similar thoughts about MDU for quite some time, but I'm starting to look forward. MLP vs current deal? I don't know which would be better. All I'm saying is this appears to be a step in the right direction.
Regardless, this again demonstrates the amount of activity Whiting has going on in the Belfield area.
MDU ownes the pipe line operation w a base in Baker, Any news on Baker Mt. activity planned?
Delete