House Energy and Natural

Resources Committee

January 10, 2019

Justin J KringstadGeological Engineer

Director

North Dakota Pipeline Authority

US Williston Basin Oil Production, BOPD

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Estimated Williston Basin Oil Transportation

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Estimated ND Rail Export Volumes

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Rail Destinations Market Share (Oct 2018)

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Data for Rail Destination Market Share Provided by the US Energy Information Administration

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Cushing $51.06

Brent $59.99WTI + $8.93

Crude Oil Prices – January 9, 2019

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Pricing Data: Bloomberg &

CME (LLS-Argus)Houston WTIWTI + $5.28

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North Dakota Oil Pricing

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Midwest (PADD 2) Refinery Crude Oil Consumption

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EIA Data

North Dakota Oil Pricing

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Bakken Drilling Economics

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www.northdakotapipelines.com

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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

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Bakken-Three Forks Drilling Inventory Study

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www.northdakotapipelines.com

Cumulative Remaining Wells – Peak Month Minimum BOPD

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30-Day Initial Production (BOPD)

Years Remaining* / Minimum Wellhead Oil Price*Assumes 1,200 Completions Per Year and $7MM Well Costs (20% After Tax IRR)

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Statewide Oil Performance

JJ Kringstad - North Dakota Pipeline Authority 16Average BKN/TF Well Performance Statewide

~13% Improvement

Over 2017

North Dakota Oil Production Forecast Assumes Current Technology – Enhanced Oil Recovery Not Included

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North Dakota Oil Production Forecast Assumes Current Technology – Enhanced Oil Recovery Not Included

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Williston Basin Oil Production & Export Capacity, BOPDAssumes Current Technology – Enhanced Oil Recovery Not Included

Production forecast is for visual demonstration purposes only and should

not be considered accurate for any near or long term planning.

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NDPA North Dakota Gas Production ForecastAssumes Current Technology – Enhanced Oil Recovery Not Included

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NDPA North Dakota Production Forecast SummaryAssumes Current Technology – Enhanced Oil Recovery Not Included

Simple Terms

Blue – Lack of pipelines

Orange – Challenges on existing

infrastructure

GREEN – % of gas captured and sold

Blue – % flared from zero sales wells

Orange – % flared from wells with at

least one mcf sold.

Oct. 2018 Data – Non-Confidential WellsStatewide

Solving the Flaring Challenge

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Bakken and Three Forks Gas Performance

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Dunn McKenzie Mountrail Williams

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Solving the Flaring ChallengeAssumes Current Technology – Enhanced Oil Recovery Not Included

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Solving the Flaring ChallengeAssumes Current Technology – Enhanced Oil Recovery Not Included

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Upcoming or

Recent Plant

Expansion

WBI Transmission

Andeavor

Major Gas Pipeline and Processing Infrastructure

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Northern Border Pipeline

*Data Source: Northern Border IPS

• 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

Simplified Example NB CalculationsConclusion: IF no other gas export options open and all other deliveries on other pipelines stay static, ND

gas production could increase 1.11-1.41 BCFD (from Oct-18) before Northern Border is 100% Bakken

production. BTU management becomes increasingly important for Bakken residue gas.

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Now What?

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Regional NGL Infrastructure

Kinder

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North Dakota Captured* NGL’s

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NGL Pipeline Takeaway Options

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ONEOK Elk Creek NGL Pipeline

Project Highlights

• 900 Miles - 20” Pipeline

• $1.4 Billion

• 240,000 BPD Capacity

• Expandable to 400,000

BPD

• End of 2019 Proposed

Completion

• Y-Grade Transportation

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North Dakota Pipeline Construction

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Sources: NDIC & PHMSA

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North Dakota Pipeline Construction

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Sources: NDIC & PHMSA

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Justin J. Kringstad, DirectorNorth Dakota Pipeline Authority

600 E. Boulevard Ave. Dept. 405Bismarck, ND 58505-0840

Phone: (701)220-6227Fax: (701)328-2820

E-mail: jjkringstad@ndpipelines.com

Websites: www.pipeline.nd.gov

www.northdakotapipelines.com

Contact Information

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