1.1 Mile Pipeline To Cost $4.5 Million -- In North Dakota -- July 18, 2016

Updates

July 20, 2016: in California, a 65-mile pipeline would have cost $621 million. 

July 19, 2016: a reader correctly points out why the cost of this short pipeline would be so high: front end engineering, permits, land acquisition, tie-ins - probably hot taps at both ends, valves at both ends, launcher at one end and receiver at other, mob/demob costs = $3MM?, 1 mile of pipeline = $1MM?

I replied: Yes, you are correct. The longer the pipeline, the better the law of large numbers works. A short pipeline with all the requirements at either end is obviously the reason. Thank you.
 

Original Post

 

I have historically used "$1 million / 1 mile of pipeline" as an estimate when guesstimating the price of a new pipeline.

I might have to re-set my "calculator." According to the AP/Bakken.com, these data points:

• ETP seeks a permit for a 1.1 mile-long crude oil pipeline
• $4.5 million project
• from the Ramberg Truck Facility to the ETP Facility about seven miles south of Tioga
• capacity: 70,000 bopd; "normal" amount -- 50,000 bopd
• location of hearing: Neset Consulting Service

Project and map here. 

When you look at the map, one finds it incredible. The pipeline is between two streets and two avenues -- I mean, we are talking a really, really small connector pipeline -- and it is projected to cost $4.5 million. Wow.

For newbies: when thinking about the cost of this project, that helps put into perspective how incredibly "valuable" the Bakken is.