Le Lézard
Classified in: Oil industry, Transportation, Business
Subject: CXP

MDU Resources Announces Five-Year Capital Investment Plan


BISMARCK, N.D., Nov. 22, 2022 /PRNewswire/ -- MDU Resources Group, Inc. (NYSE: MDU) today announced its plans to make capital investments totaling $3.5 billion over the five-year period from 2023 to 2027.

"Our capital investment plan includes a number of key projects that are expected to provide organic growth across our businesses, with particular emphasis on upgrades and expansions to our electric transmission and distribution infrastructure and our natural gas transportation and distribution systems," said David L. Goodin, president and CEO of MDU Resources. "These capital investments encompass all our businesses while we continue to make progress toward our strategic initiatives of creating two pure-play public companies."

On Aug. 4, the company announced its intent to separate Knife River Corporation, which is expected to be effected as a tax-free spinoff to MDU Resources shareholders. In addition, on Nov. 3, the company announced a strategic review process for MDU Construction Services Group, Inc. The company plans to provide a progress update in mid-December on its strategic initiatives.

Capital Expenditures


Forecast

Actual + 2022
Forecast

Forecast


2022

2023

2024

2025

2018-2022

2023-2027


(in millions)

Regulated energy delivery







Electric

$156

$112

$127

$130

$638

$823

Natural gas distribution

236

224

311

260

1,012

1,266

Pipeline

71

145

117

127

509

458


463

481

555

517

2,159

2,547

Construction materials and services







Construction materials and contracting

189

125

183

173

1,268

804

Construction services

47

38

34

34

246

178


236

163

217

207

1,514

982

Total*

$699

$644

$772

$724

$3,673

$3,529

* Excludes "Other" category, as well as assumed net proceeds from the sale or disposition of property.

MDU Resources plans to make substantial investments in its utility operations with a 27% increase in capital expenditures compared to the previous five years. The company anticipates its electric and natural gas utilities will grow rate base by approximately 6%-7% annually over the next five years on a compound basis. Customer growth is expected to continue at a rate of 1%-2% annually across the company's eight-state service territory.

The outlined capital investment plan includes meeting service needs related to customer growth as well as replacing, expanding and modernizing infrastructure within the electric and natural gas distribution systems. These infrastructure investments will provide enhanced reliability and safety across the company's systems, in addition to serving a growing customer base. The plan includes construction of transmission and substations, power production upgrades and improvements, and the recently announced Jamestown-to-Ellendale 345-kilovolt transmission project in North Dakota, which is estimated to cost $439 million and of which the company expects to invest 50% or $220 million, recovered through a MISO rate.

Capital investments at the pipeline business reflect a continued focus on organic growth. The plan includes several expansion projects, including the previously announced Wahpeton Expansion project in North Dakota, which collectively would add more than 300 million cubic feet per day of incremental natural gas transportation capacity. These projects support industrial customers, local distribution companies and electric power generation natural gas demand. Additionally, some projects also will help reduce natural gas flaring in the Bakken while allowing producers to move more gas to market. This business is focused on growth through additional system expansions and potential industrial-related projects.

At Knife River, the construction materials business, capital expenditures will be focused primarily on organic expansion opportunities and normal equipment and plant replacements and upgrades. The company expects public sector workload growth from infrastructure spending initiatives, specifically benefiting from the Infrastructure Investment and Jobs Act and Inflation Reduction Act providing long-term opportunities across the company's footprint.

Capital expenditures at MDU Construction Services Group, the construction services business, will be focused primarily on normal equipment replacements and upgrades. The company also expects public sector workload growth for this business from the Infrastructure Investment and Jobs Act and Inflation Reduction Act.

The capital program is subject to continued review and modification by the company. Actual expenditures may vary from the estimates due to changes in load growth, regulatory decisions and other factors. Acquisitions would be incremental to the company's 2023 to 2027 outlined capital investment plan. The company will provide updates as it identifies opportunities outside the plan.

Forward-Looking Statements
The information in this release includes certain forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements contained in this release, including capital expenditure forecasts, underlying expectations, whether or not the Knife River separation occurs, potential outcomes of the strategic review of MDU Construction Services Group, and statements by the president and CEO of MDU Resources, are expressed in good faith and are believed by the company to have a reasonable basis. Nonetheless, actual results may differ materially from the projected results expressed in the forward-looking statements. For a discussion of important factors that could cause actual results to differ materially from those expressed in the forward-looking statements, refer to Item 1A-Risk Factors in MDU Resources' most recent Form 10-K and subsequent filings with the SEC.

About MDU Resources
MDU Resources Group, Inc., a member of the S&P MidCap 400 and the S&P High-Yield Dividend Aristocrats indices, is Building a Strong America® by providing essential products and services through its regulated energy delivery and construction materials and services businesses. For more information about MDU Resources, visit www.mdu.com or contact the Investor Relations Department at investor@mduresources.com.

Financial Contact: Brent Miller, director of financial projects and investor relations, 701-530-1730
Media Contact: Laura Lueder, manager of communications and public relations, 701-530-1095

SOURCE MDU Resources Group, Inc.


These press releases may also interest you

at 02:18
Aker BP will publish its financial report for the fourth quarter 2022 on Friday 10 February 2023. The company issues this trading update to summarize its production and sales volumes and related topics for the quarter. Aker BP produced 432.0 thousand...

at 00:00
Sungrow, the global leading inverter and energy storage system solution supplier, signed a strategic distribution agreement for PV inverter solutions with the reputed Al-Babtain Leblanc, further facilitating Saudi Vision 2030 ambitions to accelerate...

26 jan 2023
Today, Leading Light Wind, the...

26 jan 2023
The "South African Diesel Genset Industry, Outlook 2025" report has been added to  ResearchAndMarkets.com's offering. South Africa is arguably sub-Saharan Africa's most developed economy and home to the region's largest energy sector. However, the...

26 jan 2023
ALLY Energy invites energy executives, business leaders, decision makers, and ALLY corporate members to attend the "Krewe de ALLY" Annual Meeting on Thursday, Feb. 16 from 9 a.m. to 2 p.m. CT at the Greater Houston Partnership. ALLY also welcomes...

26 jan 2023
Darling Ingredients Inc. , today announced that long-time board member Mary Korby has informed the board that she plans to retire, effective at the company's 2023 Annual Meeting of Stockholders. Ms. Korby will remain a director and maintain her...



News published on 22 november 2022 at 16:55 and distributed by: