Williston Basin Petroleum Conference Justin J Kringstad Geological Engineer Director North Dakota Pipeline Authority May 22, 2018
Natural Gas Capture Production Gathering Processing Transmission Technology Markets Capacity Connections Capacity Location Dry Gas Natural Gas Liquids JJ Kringstad - North Dakota Pipeline Authority 2 2
Natural Gas Capture Production Gathering Processing Transmission Technology Markets Capacity Connections Capacity Location Dry Gas Natural Gas Liquids JJ Kringstad - North Dakota Pipeline Authority 3 3
Bakken Drilling Economics www.northdakotapipelines.com JJ Kringstad - North Dakota Pipeline Authority 4 4
Breakeven Summary JJ Kringstad - North Dakota Pipeline Authority 5 5
Bakken Breakeven Price Range (20% IRR) Bakken Breakeven Prices $6 - $8 Million Completed Wells Cost Background Map: Esri, HERE, DeLorme, MapmyIndia, OpenStreetMap contributors, and the GIS user community JJ Kringstad - North Dakota Pipeline Authority 6 6
Statewide Gas Performance JJ Kringstad - North Dakota Pipeline Authority Average BKN/TF Well Performance 7 Statewide 7
Bakken and Three Forks Well Performance JJ Kringstad - North Dakota Pipeline Authority 8
Bakken and Three Forks Gas Oil Ratio JJ Kringstad - North Dakota Pipeline Authority 9
DOE-EIA Forecasted Oil Price JJ Kringstad - North Dakota Pipeline Authority 10 10
Forecasting Activity vs. Price JJ Kringstad - North Dakota Pipeline Authority 11 11
North Dakota Forecast Activity Assumptions JJ Kringstad - North Dakota Pipeline Authority 12 12 12
NDPA North Dakota Gas Production Forecast JJ Kringstad - North Dakota Pipeline Authority 13 13
Natural Gas Capture Production Gathering Processing Transmission Technology Markets Capacity Connections Capacity Location Dry Gas Natural Gas Liquids JJ Kringstad - North Dakota Pipeline Authority 14 14
Solving the Flaring Challenge February 2018 Non-Confidential Bakken/Three Forks/Sanish Only (Wells Flaring 10+mcfd) OpenStreetMap contributors JJ Kringstad - North Dakota JJ Kringstad Pipeline - North Authority Dakota Pipeline Authority 15 15
Solving the Flaring Challenge GREEN % of gas captured and sold Blue % flared from zero sales wells Orange % flared from wells with at least one mcf sold. Simple Terms Blue Lack of pipelines Orange Challenges on existing infrastructure Statewide Mar 2018 Data Non-Confidential Wells JJ Kringstad - North Dakota Pipeline Authority 16
Solving the Flaring Challenge JJ Kringstad - North Dakota Pipeline Authority 17
Solving the Flaring Challenge JJ Kringstad - North Dakota Pipeline Authority 18
Days to Connect to Gas Gathering JJ Kringstad - North Dakota JJ Kringstad Pipeline - North Authority Dakota Pipeline Authority 19 19
North Dakota Petroleum Pipeline Construction Sources: NDIC & PHMSA JJ Kringstad - North Dakota Pipeline Authority 20
North Dakota Petroleum Pipeline Construction Sources: NDIC & PHMSA JJ Kringstad - North Dakota Pipeline Authority 21
New Miles and Well Completions JJ Kringstad - North Dakota Pipeline Authority 22
Natural Gas Capture Production Gathering Processing Transmission Technology Markets Capacity Connections Capacity Location Dry Gas Natural Gas Liquids JJ Kringstad - North Dakota Pipeline Authority 23 23
Solving the Flaring Challenge JJ Kringstad - North Dakota JJ Kringstad Pipeline - North Authority Dakota Pipeline Authority 24 24
Solving the Flaring Challenge JJ Kringstad - North Dakota JJ Kringstad Pipeline - North Authority Dakota Pipeline Authority 25 25
Natural Gas Capture Production Gathering Processing Transmission Technology Markets Capacity Connections Capacity Location Dry Gas Natural Gas Liquids JJ Kringstad - North Dakota Pipeline Authority 26 26
JJ Kringstad - North Dakota JJ Kringstad Pipeline -Authority North Dakota Pipeline Authority 27 Major Gas Pipeline and Processing Infrastructure Whiting WBI Transmission
Northern Border Pipeline 42 Pipeline Carries Canadian (Port of Morgan) and Domestic Gas Receives Gas From ND Plants, WBI Transmission Interconnections, and WY Pipelines (Bison & Grasslands) Midcontinent Deliveries JJ Kringstad - North Dakota Pipeline Authority *Data Source: Northern Border IPS 28
Northern Border Pipeline JJ Kringstad - North Dakota Pipeline Authority *Data Source: Northern Border IPS 29
Simplified Example NB Calculations Conclusion: IF no other gas export options open and all other deliveries on other pipelines stay static, ND gas production could increase 1.56-1.86 BCFD (from Mar-18) before Northern Border is 100% Bakken production. BTU management becomes increasingly important for Bakken residue gas. JJ Kringstad - North Dakota Pipeline Authority 30
Simplified Example NB Calculations Conclusion: IF no other gas export options open and all other deliveries on other pipelines stay static, ND gas production could increase 1.56-1.86 BCFD (from Mar-18) before Northern Border is 100% Bakken production. BTU management becomes increasingly important for Bakken residue gas. Gas Plants With C2+ Capture ~1,010+ BTU Residue Gas Gas Plants With C3+ Capture ~1,150+ BTU Residue Gas JJ Kringstad - North Dakota Pipeline Authority 31
Now What? 32 JJ Kringstad - North Dakota Pipeline Authority 32 32
Alliance Pipeline Open Season Project Highlights Existing 36 Pipeline Existing ~1,600 MMCFD Capacity Proposing ~400 MMCFD of Additional Capacity to Canadian and US Shippers 2021 Proposed In-Service Dense Phase Gas Transportation to Chicago JJ Kringstad - North Dakota JJ Kringstad Pipeline - North Authority Dakota Pipeline Authority 33 33
Increasing Midwest Gas Competition 34 JJ Kringstad - North Dakota Pipeline Authority 34 34
Regional NGL Infrastructure Kinder JJ Kringstad - North Dakota Pipeline Authority 35
North Dakota Captured* NGL s 36 JJ Kringstad - North Dakota Pipeline Authority *Non-flared NGL s & Assumes 36 10 GPM 36
NGL Pipeline Takeaway Options 37 JJ Kringstad - North Dakota Pipeline Authority 37 37
Contact Information Justin J. Kringstad, Director North Dakota Pipeline Authority 600 E. Boulevard Ave. Dept. 405 Bismarck, ND 58505-0840 Phone: (701)220-6227 Fax: (701)328-2820 E-mail: jjkringstad@ndpipelines.com Websites: www.pipeline.nd.gov www.northdakotapipelines.com JJ Kringstad - North Dakota Pipeline Authority 38