North Dakota state regulators signed off on a proposed natural gas processing plant, as well as a separate wind energy project, to be built in the state’s western region. The approval came last Wednesday, and the projects together account for $360 million of brand new infrastructure.
The natural gas plant is being built by a subsidiary of Oneok Inc. (NYSE: OKE), based out of Tulsa, Oklahoma. It will, on completion, be able to process 100 million cubic feet of gas per day.
Oneok operates two similar facilities in northwestern North Dakota, with an additional two under development. The fifth facility will be named Garden Creek II and will be built in McKenzie County. Oneok expects to complete the project by late 2014.
North Dakota has recently experienced a veritable boom in oil and natural gas production. Things are at a point where almost one-third of the total production of natural gas is being burned off (and thus wasted) because existing pipelines cannot deal with the expansion in production volume.
Bloomberg reports:
“We like to see that gas being gathered and processed and moved to market. It’s a much better destination than flaring it,” Public Service Commissioner Kevin Cramer said. “When you live in a cold-weather state, watching 30 percent of (natural gas) being flared is hard to take.”
Almost 900 homes can be powered for a year based on the amount of natural gas that Garden Creek II will process per day. And that per-day amount is just a seventh of what North Dakota is now producing daily, which is around 713,000 thousand cubic feet as of June.
The state commission also approved construction for a 100-megawatt wind farm, to be built by Allete Clean Energy, a subsidiary of Allete Inc. (NYSE: ALE) of Minnesota. The wind farm will be built in Mercer and Morton counties.
Allete has not yet stated how many towers will be erected nor the size of the turbines that will be installed. The company has already completed development on an 82-megawatt wind farm in Oliver and Morton counties named Bison I, and it is working on another two projects.
The new wind farm will produce enough power to run 40,000 households. In total, wind energy projects in the state can generate around 1,500 megawatts.
