) announced that one of its subsidiaries has received approval and
funding assistance from the North Dakota regulator and North Dakota
Public Service Commission ("NDPSC"), respectively. Per the
agreement, the company will develop a natural gas processing plant
in western North Dakota. The NDPSC has sanctioned $160 million for
this new project development.
ONEOK believes that the new establishment will process
approximately 100 million cubic feet ("MMcf") of natural gas on a
regular basis. The company expects this project to come online by
We have observed that North Dakota has been witnessing surge in its
crude oil production level. Subsequently, as a byproduct of crude
oil, chances of gathering more natural gas is also very high in
this region and ONEOK will leave no stones unturned to capitalize
on this opportunity.
Presently, ONEOK has two natural gas processing facilities in
northwestern North Dakota, and another two are under construction.
The fifth and latest approved facility, Garden Creek II, will be
situated six miles northeast of Watford City, in McKenzie County.
We believe that the addition of this new natural gas processing
facility will not only expand ONEOK's coverage in the North Dakota
natural gas market, but will also cater to the growing customer
needs. Considering higher natural gas prospects, the company
expects to invest $1.8 billion to $1.9 billion for natural gas
gathering and processing projects through 2015.
On the flip side, we know that the operations related to natural
gas processing and related services are weather sensitive and
seasonal in nature. ONEOK's operation will be exposed to such
periodic risk. In addition, the natural gas transportations
hazards, particularly in North Dakota, will also negatively impact
the overall transported volume.
ONEOK Inc. currently retains a Zacks #3 Rank, which translates into
a short-term Hold rating.
Based in Tulsa, Oklahoma, ONEOK Inc. is a diversified energy
company, operating as a natural gas distributor, primarily in the
United States. The company competes with
OGE Energy Corp.
OGE ENERGY CORP (OGE): Free Stock Analysis
ONEOK INC (OKE): Free Stock Analysis Report
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