Western Refining Investing in the Bakken Through Minnesota Refinery

Northern Tier Energy Asset Map
Northern Tier Energy Asset Map

Western Refining has agreed to acquire Northern Tier Energy's general partner from Acon Investments and TPG for total consideration of $775 million.

The acquisition gives Western ownership in an 89,500 b/d refinery in St. Paul Park, MN, an interest in a 455,000 b/d pipeline moving crude from Clearbrook to St. Paul Park, as well as other assets.

More than half of the feedstock used in the St. Paul Park refinery is considered light sweet and "most" of the light-sweet crude comes from the Bakken.

This investment further enhances our strategic goal of expanding our refining presence in areas with direct pipeline access to cost-advantaged crude oil resources...... Northern Tier Energy’s St. Paul Park refinery is a very successful refinery with pipeline access to cost-advantaged crude oil and refined product regions that historically have generated strong product margins.
— Jeff Stevens, Western's CEO

The CEO is referencing Bakken oil when he mentioned "cost-advantaged" crude oil. The refinery is strategically placed to benefit from future Bakken production growth.

Northern Tier's Assets Include:

  • St. Paul Park Refinery - 89,500 barrels per day refining capacity and processes 100% cost-advantaged crude oil - 75% light, 25% heavy
  • Pipeline access to Bakken and Canadian crude oil - 17% interest in a 455,000 barrel per day crude oil pipeline
  • Products terminals, storage tanks, rail facilities and Mississippi river dockage
  • Retail assets which include the SuperAmerica retail channel
  • 163 company operated convenience stores
  • 74 franchised convenience stores

Read the full story at jamestownsun.com

Thunder Butte Petroleum Services Refinery Ground Broken

Thunder Butte Petroleum
Thunder Butte Petroleum

Ground has been broken at the site of the Thunder Butte Petroleum Services Refinery southwest of Minot, ND. Three affiliated Indian tribes have joined together for the $450 million project that will be constructed on a 476-acre site.

This is the second refinery to break ground in the past two months. The Dakota Prairie Refinery Groundbreaking was held in March near Dickinson.

It`s really an important time for our people. It`s exciting,” said tribal representative Ken Hall. “But we have to be mindful going forward to not lose our culture.

Full-scale construction will start on the Thunder Butte Refinery in August and will be completed in phases over the next two years.

Once completed, the refinery will employee 100 people and refine 20,000 b/d of Bakken crude into diesel and other petroleum products.

You can read about the entire process at mharefinery.com

Dakota Prairie Refinery Groundbreaking - MDU Resources

Dakota Prairie Refinery Groudbreaking Governor Dalrymple
Dakota Prairie Refinery Groudbreaking Governor Dalrymple

A partnership between MDU Resources and Calumet Specialty Product Partners broke ground on the Dakota Prairie Refinery on Tuesday.

The 318-are site where the refinery will be built sits just west of Dickinson in Stark County, ND. Construction is expected to take less than two years and will employ 400-500 people at the peak. Ongoing operations will employ approximately 100 people. Those are stable Bakken Jobs that will be around for decades to come. Hiring and training of operating personnel is expected to begin in 2013.

"Bringing this project from concept to construction took the effort of a great many people," said David L. Goodin, president and chief executive officer of MDU Resources. "We especially appreciate the support of Governor Dalrymple, other state officials and state agencies. Their permitting process was rigorous, but at the same time they helped us identify and solve problems that are involved in a complex project such as this."

Dakota Praire Groundbreaking Shovels
Dakota Praire Groundbreaking Shovels

The refinery will have the capacity to process 20,000 b/d of local crude oil and will primary produce diesel. Diesel is in high demand in North Dakota and the state is challenged with a surplus of crude and a shortage of refined products. This plant will help meet strong local demand.