We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
MDU Resources' (MDU) Arms to Expand Operations in North Dakota
Read MoreHide Full Article
The subsidiaries of MDU Resources Group, Inc. (MDU - Free Report) , namely Montana-Dakota Utilities Co. and WBI Energy, Inc. are planning to expand the natural gas pipeline project in the Eastern North Dakota. This new project will assist the company to provide more natural gas to its existing customers in Wahpeton along with introducing its services to Kindred.
Montana-Dakota Utilities has contracts, which need 10 million cubic feet (MMcf) per day of service in Wahpeton, which is more than the company’s existing capacity. WBI Energy plans to expand a 60-mile, 12-inch natural gas pipeline and ancillary facilities to meet rising demand via capacity growth by 20 MMcf per day. The expected cost is $75 million and following all regulatory approvals, the company plans to begin construction in early 2024 and place it in service later that year.
Prior to this, WBI Energy started building the North Bakken Expansion project in Northwestern North Dakota after receiving an approval from the Federal Energy Regulatory Commission on Jul 8. The unit has plans to make $508 million worth investment in the pipeline business over the next five years and strengthen its core operations.
Company’s Capex Plans
After spending $648 million in 2020, the utility spent $107.2 million in the first quarter of 2021. However, it reduced its investment plans to $810.5 million from $826 million in the ongoing year. It expects to invest $3,032 million during the 2021-2025 period. These investments will increase the reliability of its services and enable it to serve an expanding customer base effectively. The company expects to see a 5% CAGR for its rate base over the next five years.
During the 2021-2025 time frame, it expects to invest $606 million and $970 million in electric and natural gas distribution business, respectively. Also, the company is likely to witness 1-2% customer growth in these segments, annually.
Other gas distribution utilities are also expanding their operations on the back of strategic capital investment plans. These include National Fuel Gas Company (NFG - Free Report) , ONEOK Inc. (OKE - Free Report) and Atmos Energy Corporation (ATO - Free Report) . National Fuel Gas Company plans to invest in the range of $720-$830 million during fiscal 2021. ONEOK expects growth and maintenance capital expenditures in the band of $335-$465 million and $190-$210 million, respectively, in 2021. Atmos Energy remains on track to spend in the $2-$2.2 billion band during fiscal 2021.
Image: Bigstock
MDU Resources' (MDU) Arms to Expand Operations in North Dakota
The subsidiaries of MDU Resources Group, Inc. (MDU - Free Report) , namely Montana-Dakota Utilities Co. and WBI Energy, Inc. are planning to expand the natural gas pipeline project in the Eastern North Dakota. This new project will assist the company to provide more natural gas to its existing customers in Wahpeton along with introducing its services to Kindred.
Montana-Dakota Utilities has contracts, which need 10 million cubic feet (MMcf) per day of service in Wahpeton, which is more than the company’s existing capacity. WBI Energy plans to expand a 60-mile, 12-inch natural gas pipeline and ancillary facilities to meet rising demand via capacity growth by 20 MMcf per day. The expected cost is $75 million and following all regulatory approvals, the company plans to begin construction in early 2024 and place it in service later that year.
Prior to this, WBI Energy started building the North Bakken Expansion project in Northwestern North Dakota after receiving an approval from the Federal Energy Regulatory Commission on Jul 8. The unit has plans to make $508 million worth investment in the pipeline business over the next five years and strengthen its core operations.
Company’s Capex Plans
After spending $648 million in 2020, the utility spent $107.2 million in the first quarter of 2021. However, it reduced its investment plans to $810.5 million from $826 million in the ongoing year. It expects to invest $3,032 million during the 2021-2025 period. These investments will increase the reliability of its services and enable it to serve an expanding customer base effectively. The company expects to see a 5% CAGR for its rate base over the next five years.
During the 2021-2025 time frame, it expects to invest $606 million and $970 million in electric and natural gas distribution business, respectively. Also, the company is likely to witness 1-2% customer growth in these segments, annually.
Other gas distribution utilities are also expanding their operations on the back of strategic capital investment plans. These include National Fuel Gas Company (NFG - Free Report) , ONEOK Inc. (OKE - Free Report) and Atmos Energy Corporation (ATO - Free Report) . National Fuel Gas Company plans to invest in the range of $720-$830 million during fiscal 2021. ONEOK expects growth and maintenance capital expenditures in the band of $335-$465 million and $190-$210 million, respectively, in 2021. Atmos Energy remains on track to spend in the $2-$2.2 billion band during fiscal 2021.
Zacks Rank & Price Performance
MDU Resources currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
In the past six months, shares of the utility have rallied 16.7%, outperforming the industry’s 14% growth.
Six Months Price Performance
Image Source: Zacks Investment Research