Even though his company was “the small guy on the panel, ” Saddle Butte Pipeline Senior Vice President for Business Development David Lytle told attendees at the recent North Dakota Governor’s Pipeline Summit that Saddle Butte has a ”big vision” and is accomplishing a lot of big things to meet the demands of the Bakken petroleum system.
This was, he said, Saddle Butte’s first participation in such a forum. Company officials, he said, have been trying to stay focused on their customers, working hard to provide them with efficient and reliable gathering services.
A young, privately held midstream company, Saddle Butte provides crude oil, gas and produced water services. Their main office is in Durango, Colo. but the company also has offices in Denver and Houston, and two field offices in North Dakota, one near Johnsons Corner and the other at a Saddle Butte plant in Watford City.
Lytle said the company started roughly in 2009 at a time when Bakken producers were still trying to figure out details of their development plans such as “the 640s, the 1280s, how many wells per drilling unit.” Saddle Butte, he added, was looking at the infrastructure challenges that these plans created and how to properly design the infrastructure to make sure all the capacity to downstream markets would be there.
Hauling production water ‘huge deal’
Noting that water was not a being discussed in detail at the Summit, Lytle said that at the front end production water is “a huge deal” and truck trips of all kinds contribute to road issues as well as safety in the communities. Producers are “taking that to heart” and Saddle Butte is working to provide solutions to the challenges that produced water creates.
Although Saddle Butte has only been around a “few short years,” Lytle said the company has put together an experienced management team that can provide producers with “friendly wellhead to market” midstream services. He said the senior management team averages 25 years of industry experience which brings a lot of innovative solutions, ideas and an aggressive business mindset.
All the people at Saddle Butte are committed to customer service and are committed to do the right things every day, Lytle continued, and said that dedication to get things done with all of the challenges and all the work that needs to get done “goes well beyond a 40-hour work week.”
He said everyone at Saddle Butte, from its construction and field operations personnel in North Dakota to its engineering groups, project management, and the lands and accounting groups, all factor in to executing company plans across the board and keeping customers satisfied.
He said he couldn’t say enough good things about the people at Saddle Butte — because of these people, Saddle Butte has been able to accomplish a lot in a short period of time.
The dedicated people at Saddle Butte make his and other managers’ easier when they can walk into customer’s offices and show how well Saddle Butte has been able to execute the things its doing.
Saddle Butte gathering system
One of Saddle Butte’s core focus areas in the Bakken is the Saddle Butte gathering system. Lytle said Saddle Butte began work in the Bakken on the Fort Berthold reservation providing gas and oil gathering services where, at the time, there was a complete lack of infrastructure due to the “newness” of Bakken production.
As activity ramped up throughout McKenzie County, Saddle Butte has expanded its system to the west all the way to Alexander.
The company’s Little Missouri gas processing plant south of Watford City currently has a capacity of 25 million cubic feet per day and the company is now working to double that capacity in order to stay ahead of demand so that the gas is processed and not flared.
Lytle added that Saddle Butte also has two crude oil terminals, one delivering into Enbridge at Alexander and the other delivering into Bridger Pipeline’s Four Bears line at Johnsons Corner.
Saddle Butte is also working to develop a number of rail outlets.
Rail provides significant value uplift to producers given the differentials seen today, as well as flexibility and options to move product with the rapid growth in production that has exceeded pipeline capacity, he said.
Since 2010 Saddle Butte has built over 250 miles of crude oil and gas pipelines in McKenzie and Dunn counties, and Lytle said Saddle Butte sees significant growth opportunities in this area over the next few years and beyond.
Its existing trunk line begins at the gathering system on the Fort Berthold reservation and runs through Johnsons Corner and on to Alexander, connecting numerous gathering lines and well connects along the way. Crude oil is delivered into the Johnsons Corner facility or goes on to Alexander, and gas is delivered to its Little Missouri processing plant.
High Prairie pipeline
Saddle Butte’s other core focus area in the Bakken is the High Prairie pipeline, which is an interstate crude oil project that will focus primarily on production in McKenzie and Dunn counties.
The 16-inch crude line will begin at Alexander and run some 450 miles east to Clearbrook, Minn., and will have 150,000 barrels per day capacity.
The project includes a 17 mile lateral originating at Johnsons Corner and an eight mile lateral originating near Robinson Lake in Mountrail County.
The High Prairie line will also have truck stations at Alexander, Johnsons Corner and East New Town, as well as a rail loading terminal near Clearbrook with a capacity of 120,000 barrels per day.
The High Prairie project will include approximately 500,000 barrels of operational storage, and significant long-term storage facilities near Clearbrook.
The company is working with shippers for additional storage to “help balance out the peaks and valleys” of the markets and shipper lines.
In addition, Lytle said, Saddle Butte will establish a backhaul service for the High Prairie which should help reduce truck hauls in the area.
The High Prairie system is scheduled to go into service in the fourth quarter of 2013, subject to regulatory approvals. Lytle said Saddle Butte completed an open season on the High Prairie in April and is currently finalizing terms and conditions with prospective shippers.
In his closing comments Lytle first said that Saddle Butte is very proud to have business operations in North Dakota and that it is very thankful for the positive business environment in the state.
He said North Dakota coined the phrase “North Dakota is open for business,” and that is “one hundred percent true.”
Lytle went on to say that Saddle Butte is very appreciative of its customers who “believed in us and helped us get our business off the ground here in North Dakota.”
Saddle Butte employees, he said, work hard every day to live up to customer expectations.
Finally, Lytle thanked all the landowners who agreed to work with Saddle Butte and allowed the company to build its systems.
