Railroads Bump Up Montana Transport Services to Support Growing Bakken Shale Oil Production

Growing Bakken Shale Production Spurs Infrastructure Developments

An emerging oil play for the US, increasing Bakken Shale production is largely stranded by limited midstream infrastructure. There are currently a number of pipeline and other transport projects under development to connect this oil production with the market.

Earlier this year, Savage Companies announced plans to construct, own and operate a large multi-user rail terminal in Trenton, North Dakota, to support increased oil production in the Bakken Formation, as well as transport drilling and development equipment to the region.

Additionally, ONEOK is currently working to build a more than 600-mile-long NGL pipeline in the region, whileEnbridge and Rangeland Energy are also building pipelines to transport Bakken Shale production. Plains All American Pipeline recently closed an acquisition of Nexen's Bakken gathering and transportation assets, as well.

Source: Penn Energy

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North Dakota Economy Fastest Growing in the Nation

US Commerce department records show the state's economy grew 7.1 percent last year. That compares to the nation's growth of 2.9 percent. North Dakota's success is largely due to the oil boom in the Bakken shale and the businesses built around it.


Source: WDay News

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Another Sundance Beckoning?

For those not afraid of a bit of risk, oil and gas producer and explorer Entek could be right up their alley.

At 15 cents the company has a market cap of almost $80 million and is described by one invested fundie as “a smaller version of Sundance Energy”.

Sundance (ASX: SEA) is a shale oil and gas producer and also has operations in the “Niobrara” shale region in the US. Niobrara refers to a large and very old inland sea that extends from Texas up through Colorado and Wyoming towards Canada.

Even after recent weakness, Sundance's shares have increased five-fold in the past year, but this relates to its activities in the Bakken region located to the east, primarily in North Dakota. This is shale gas technology has been most successful. Niobrara has much potential, but has had little success thus far.

Source: Brisbane Times


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American Standard Energy Corp. Enters Info Letters of Intent to Purchase Multiple Properties

SCOTTSDALE, Ariz., June 2, 2011 /PRNewswire/ -- American Standard Energy Corp. (the "Company") (OTCBB:ASEN), announces that it has entered into four non-binding Letters of Intent (LOI) today to acquire acreage in its three primary areas of operations: the Bakken of North Dakota and the Eagle Ford and Permian Basin plays of Texas and New Mexico. An LOI was signed for each of the following:

• Bakken: ASEN has entered into an LOI to purchase approximately 15,000 acres in the Bakken shale play of North Dakota.  This acquisition would increase the Company's total acreage in the Bakken to approximately 48,000 net acres. The agreement covers acreage in the heart of the play being mostly in Mountrail, Burke, Williams McKenzie and Divide Counties. A significant portion also lies in the newest "hot spot" of the Bakken being Stark and Dunn counties.

Source: PR Newswire

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Rail Roads Aim to Tap Bakken Shale's Vast Traffic Potential

The lyrics to the theme song from vintage television series "The Beverly Hillbillies" included "black gold, Texas tea," which described the Lone Star State's lucrative crude-oil production. For several North American railroads, the lyrics could be updated to "black gold, North Dakota tea" or "black gold, Saskatchewan tea" to describe the traffic-generating and moneymaking potential of crude-oil production in the Bakken Formation.

More commonly called the Bakken Shale, the 200,000-square-mile formation covering parts of Montana, North Dakota and Saskatchewan contains large oil reserves, which only a few years ago became more economical to tap because of horizontal drilling and other modern extraction techniques. Today's historically high foreign oil prices also help make crude produced from a shale more competitive to produce and sell domestically.

As more oil companies establish wells in the Bakken, railroads stand to transport more inbound carloads of frac sand, drilling pipe and other materials used to build wells or horizontally drill. And as more crude oil is extracted, the roads figure to transport lots of it to refineries and other end users thousands of miles away in the Gulf Coast, California, Oklahoma or points in Canada. Rail transport is significantly cheaper than truck and more flexible than pipelines to move crude long distances, and an economical way to deliver inbound materials, so it's starting to become oil producers' mode of choice.

Source: Progressive Railroading

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Pipeline Planned from Watford City to Sidney

The company that announced investing millions of dollars in projects in the Bakken region has intentions for another project that should fit nicely.

ONEOK Partners plans to build a 62-mile natural gas liquids line from Watford City, N.D., to a Sidney rail facility for processing. Brad Borror, supervisor of external communications for ONEOK, said the line will eventually connect to the Bakken Pipeline, a 500-mile pipeline starting just south of Sidney and traveling south through Wyoming into northern Colorado. That pipeline will transport raw, unfractionated natural gas liquids from natural gas processing plants in the Bakken Shale play to the company’s 50 percent owned existing Overland Pass Pipeline which travels to Kansas where natural gas liquids are processed.

When completed, the Bakken Pipeline will provide approximately 60,000 barrels per day of NGL takeaway capacity to the region. The pipeline project won’t break ground until next year, but work on the pipeline from Watford City should begin this summer.

Source: Sidney Herald

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