Williston Basin Interstate Pipeline Company, the wholly owned natural gas transmission pipeline subsidiary of MDU Resources Group, Inc. (NYSE:MDU), will expand firm transportation capacity on its existing Grasslands Pipeline by 54 percent. The 253-mile Grasslands Pipeline was placed in service in late 2003, running from the Powder River Basin in northeastern Wyoming to western North Dakota, where it connects with the Northern Border Pipeline.
The expansion project will add an additional 75 million cubic feet of gas per day (MMcf/d) to its existing capacity of 138 MMcf/d. In early July 2008, Williston Basin conducted an open season on the expansion project seeking customer commitment for additional transportation capacity. Strong customer demand for the pipeline capacity pushed the project to full capacity of 213 MMcf/d. The project cost is expected to be about $28 million and the targeted in-service date is August 2009, pending timely receipt of the necessary regulatory approvals.
"We built the Grasslands Pipeline with future expansion in mind, and we are more than pleased to have reached full capacity on the pipeline in just over five years," said Terry D. Hildestad, president and chief executive officer of MDU Resources.
The Grasslands Pipeline held an initial capacity of 80 MMcf/d when it was placed in service in late 2003. Since installation, the pipeline has been incrementally expanded bringing the firm pipeline transportation capacity on that segment to its current total of 138 MMcf/d.
The Grasslands Pipeline expansion project will include the construction of two new compressor stations; one will be in western North Dakota near Golva, the other in the far corner of southeastern Montana near the Wyoming border. Additional horsepower also will be added to an existing compressor station near Manning, N.D.
"Our interstate pipeline system runs through the heart of several active energy production regions, including the newly developing Bakken Play, and we are playing a role in getting this energy to the marketplace," Hildestad said.
The information in this release includes forward-looking statements, including statements by the president and chief executive officer of MDU Resources regarding plans to develop and potential benefits of expanding transportation volumes on the Grasslands Pipeline, within the meaning of Section 21E of the Securities Exchange Act of 1934. Although the company believes that its expectations are based on reasonable assumptions, actual results may differ materially. Important factors that could cause actual results to differ materially from those in the forward-looking statements include fluctuations in natural gas prices; the timely receipt of necessary permits and approvals; market demand for, and/or available supplies of, energy-related products and services; and unanticipated project delays. For a discussion of other important factors that could cause actual results to differ, refer to Item 1A - Risk Factors in MDU Resources' most recent Form 10-K and Form 10-Q.
MDU Resources Group, Inc., a member of the S&P MidCap 400 index, provides value-added natural resource products and related services that are essential to energy and transportation infrastructure, operating in three core lines of business: energy, construction materials and utility resources. MDU Resources includes natural gas and oil production, natural gas pipelines and energy services, construction materials and contracting, construction services, and electric and natural gas utilities. For more information about MDU Resources, see the company's Web site at www.mdu.com or contact the Investor Relations Department at investor@mduresources.com.
Media Advisory - Map artwork available:
A print-ready map showing the location of the Grasslands Pipeline is available for download at http://www.mdu.com/information_news/2008_GrasslandsExpansion.jpg