An XTO plant that was on hold is a go after all, but the plant will be built by a different company, and it will be bigger. Much bigger.
XTO had received approval from Williams County for a conditional use permit in Judson Township to construct a 150 million cubic feet per day plant in the summer of 2019, but, by Fall, had put the project on hold.
The new project is going to be larger than the previously proposed facility. And it won’t be XTO building the plant.
Outrigger Energy II announced Tuesday, Jan. 7, that it will construct, own and operate a new 250 million cubic feet per day cryogenic gas processing plant west of Williston to gather and process production from XTO, as well as from other operators in the area.
SVP of Business Development Alex Woodruff told the Williston Herald the location for the new plant is still being determined. It won’t be at the previous location. He also confirmed the plant is a replacement for the previously proposed facility.
“We are building something larger (than that one),” Woodruff said. “We expect to contract with other producers in Williams County and potentially Montana. We see a greater potential for future business with our facility.”
In fact, the potential is so great that Outrigger is already considering the possibility of adding an additional processing train of 200 million cubic feet per day to the plant it is building, depending on demand.
That would bring the total processing capacity of the project to 450 million cubic feet per day.
“Williams County gas production has been limited by midstream infrastructure,” Woodruff said. “We expect that this facility will provide an excellent outlet for gas production in the county.”
To go along with the plant, Outrigger will also build a gathering system, which will include a 70-mile, 20- and 24-inch diameter rich gas pipeline originating in eastern Williams County.
The route of the gathering line is being planned to provide other Williston Basin operators with much-needed gathering and cryogenic processing capacity, Outrigger CEO Dave Keanini said in a media release.
“This additional midstream capacity for gas production north of the Missouri River allows the state of North Dakota to make strides toward its goal of minimizing gas flaring in the Basin,” he added.
All of this, of course, will require a permit from the Public Service Commission. An application for that is in the works, Woodruff said.
The cryogenic processing plant and gathering system will include ethane recovery and rejection capabilities, and will provide direct market access to the Northern Border Pipeline system for residue gas and the ONEOK NGL pipeline system for natural gas liquids.
NGL fractionation facilities could also be added to the plant, to provide finished NGL products for local markets.
The new gas plant will be Outrigger’s first project in North Dakota, though it has already established what Keanini said is an excellent track record of project execution in the Delaware, Midland, Powder River and DJ Basins.
“We couldn’t be more excited for the opportunity to do the same in North Dakota,” he said. “We are grateful XTO has entrusted Outrigger to build a gathering system with substantial capacity and state-of-the-art facilities that will assist XTO with execution of its significant development plans in Williams County.”
While the plant may be Outrigger’s first North Dakota plant, it’s not the first North Dakota experience for many of its employees, Woodruff added.
“Several members of our management team and staff have built, constructed and operated facilities in North Dakota in the past,” he said. “Going all the way back to several of us worked with Western Gas Resources as well as Beartracker Energy.”
Western Gas Resources was acquired by Anadarko Petroleum in 2006 in a $5.3 billion cash transaction.
“Keanini formed Beartracker Energy in 2010, and the main facilities they built were in North Dakota,” Woodruff said.
Beartracker was sold in 2013 to Summit Midstream Partners, after which Keanini started Outriggers I, which built Permian Basin assets that were ultimately sold to Targa Resources and Powder River Basin assets that went to Tall Grass Energy Partners in 2017.
Outrigger II, the present company, was created in August of 2018. It has been building projects in the DJ Basin, including a 60 million cubic feet per day cryogenic gas plant and related infrastructure.