Current ETP Stock Info

Initial capacity on the pipeline would be 450 MBOPD, with growth potential to 570 MBOPD

The South Dakota Public Utilities Commission (PUC) announced this week that it has decided to approve Energy Transfer Partner’s (ticker: ETP) Dakota Access Pipeline project through the state in a 2-to-1 vote. The 1,134 mile pipeline travels through 50 counties in four states.

The pipeline line is designed to transport 450 MBOPD of crude oil from the Bakken/Three Forks formations in North Dakota to a terminus near Patoka, Illinois. The project will have the potential to eventually carry as much as 570 MBOPD from the region, which could represent approximately half of Bakken current daily production, according to Energy Transfer Partners.

The 30-inch diameter pipeline will be manufactured mostly in the U.S., with 57% of the pipeline, all of the pump stations, and the majority of the major materials coming from U.S. companies, according to Energy Transfer Partners.

The dissenting vote came from PUC Commissioner Gary Hanson, who said that the pipeline would be disruptive, and could have been moved to address those issues. Despite his concerns, the other two voting members of the commission felt that the pipeline would be worth constructing, and that Energy Transfer Partners would meet the more than 50 conditions that were attached to the permit.

The project represents a $3.78 billion investment, according to the company, with $820 million being invested in the portion of the pipeline approved in South Dakota on Monday. Energy Transfer Partners expects that property taxes associated with the pipeline will reach $13.5 million by 2017, with the construction phase generating $38.5 million in sales/income taxes for the state.

The largest investment from the project will be in North Dakota, where ETP expects $1.4 billion in capital investment for the pipeline, which will traverses seven counties, and include a six tank farm location and one electric pump station.

All told, the pipeline is expected to generate $156 million in sales and income tax during the construction phase across the four states, with $55 million generated in property taxes annually after the pipeline is complete. The Dakota Access Pipeline will create 42-51 permanent jobs once it is operational. Energy Transfer Partners expects the pipeline to be ready for service in late 2016, pending regulatory approvals from the other three states.

Energy Transfer Partners Dakota Access Pipeline

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