NEW YORK—Energy Transfer LP (NYSE: ET) said on Feb. 21 it boosted capacity on the Dakota Access pipeline system to 570,000 barrels per day (bbl/d) as production in the Bakken shale basin has climbed to record highs.
Flows on the pipeline averaged above 500,000 bbl/d in the fourth quarter and nominations for space on the line exceeded available capacity during the quarter, a company executive said on its earnings call.
Energy Transfer said it is considering more expansions on the system due to the surge in demand, adding it would be able to add capacity by increasing horsepower to boost throughput.
In North Dakota’s Bakken region, shale production is estimated to rise about 13,000 bbl/d to a record 1.45 million bbl/d in March.
A shale revolution has helped propel the United States to the position of world’s biggest crude oil producer, ahead of Saudi Arabia and Russia. Total crude production has climbed to a weekly record of 11.9 million bbl/d.
Energy Transfer also said it has enough commitments to move forward on a proposed a 600-mile pipeline from the Permian Basin, the biggest oil patch in the country, to the Gulf Coast that would add at least 1 million bbl/d of capacity.
However, the company said it is now in talks with Exxon Mobil Corp. (NYSE: XON) and Plains All American Pipeline LP (NYSE: PAA) to possibly combine the two projects.
Exxon, Plains and Lotus Midstream said last month they will build a pipeline that can carry over 1 million bbl/d of oil and condensates from the Permian. That line is expected to begin operations in first-half 2021.
Energy Transfer’s Permian-to-Gulf-Coast (PGC) pipeline was expected to be in service in mid-2020, but it is now more likely to startup in 2021, if a Final Investment Decision (FID) can be made in the next 30 days.
“We’re in serious discussions with Exxon and Plains, if it makes more sense to join their project and have fewer projects built that are full on day one, that is certainly a possible direction we’ll go,” a company executive said.
Flows on all three lines of the company’s existing Permian Express pipelines are running at full capacity.
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