Dakota Prairie begins sales as MDU moves on marketing Fidelity
MDU Resources announced in early June that the Dakota Prairie refinery at Dickinson began its first diesel product sales on May 15. At the same time, MDU said it was moving forward with a previously announced plans to market its upstream subsidiary Fidelity Exploration and Production.
The Dakota Prairie refinery went into full operation refining Bakken crude in early May, and throughput is expected to reach the 20,000 bpd maximum during June, the refinery’s first full month of operation. Construction on the 20,000 barrel per day diesel-topping refinery began in March 2013. It is a joint venture between MDU Resources and Calumet Specialty Products Partners and is the first new refinery built on undeveloped property in the U.S. in nearly 40 years.
“We are assessing the potential to further enhance the productivity of the plant in the future through modifications to increase its throughput capacity,” MDU President and CEO David Goodin said in a press release.
MDU has previously expressed interest in building a second Bakken refinery, and is still considering the project. “We plan to utilize the expertise gained on the project to help develop future projects, such as a potential second plant presently being evaluated near Minot, North Dakota.”
On the upstream side, MDU announced in November 2013 its intention to market its Fidelity subsidiary, but in January those plans were put on hold due the crude oil market slump. In May, MDU said it was still planning to sell the subsidiary, but was not expecting the transaction to occur until after 2015.
However, in the same press release announcing the beginning of diesel products sales at the Dakota Prairie refinery, MDU announced it was moving forward with the Fidelity sale. “Our strategic decision to market Fidelity will allow us to fund the substantial opportunities we are seeing at our utility, pipeline and construction business units,” Goodin said of the planned sale. “After a thorough review, we concluded the timing was appropriate to move forward with the marketing and sale process.”
Fidelity controls more than 96,000 net acres in Stark County, North Dakota, and Richland County, Montana, along with another 12,000 net acres in Mountrail County, North Dakota.