MDU Resources Approves Bakken East Pipeline After Profit Drop

The Tip Desk · November 5, 2026 · 3 min read

The utility and pipeline operator earned $14.0 million, or $0.07 a share, in the third quarter as electric earnings rose and the board green-lit a $2.8 billion to $3.1 billion line.

MDU Resources Group, Inc. (MDU) reported third-quarter net income of $14.0 million, or $0.07 a share, down from $18.4 million, or $0.09 a share, a year earlier. Adjusted net income was $16.6 million, or $0.08 a share, after excluding a $2.1 million net-of-tax loss on the discontinued Knott Landfill renewable natural gas project and $0.5 million of net-of-tax Bakken East advisory costs.

Consolidated operating revenues were $347.8 million and operating income $47.6 million. The company reaffirmed 2026 earnings guidance of $0.93 to $1.00 a share.

The board’s Sept. 30 decision to proceed with WBI Energy’s Bakken East Pipeline was the quarter’s defining capital event. The company narrowed the estimated capital range to $2.8 billion to $3.1 billion from $2.7 billion to $3.2 billion. The approximately 350-mile line is designed for an initial 1.4 billion cubic feet of natural gas per day, with 42-inch, 36-inch and 30-inch-diameter pipe from west to east. Construction is expected during the 2028–2030 seasons, with Phase One from the Bakken to central North Dakota targeted for late 2029 and Phase Two to a compressor station near Mapleton in late 2030. A FERC Section 7(c) application is anticipated in the fourth quarter of 2026.

Electric utility earnings were the operating offset. The segment earned $26.5 million, up 23.6% from $21.5 million a year earlier. New rates approved in North Dakota, Montana and Wyoming contributed $7.1 million of quarterly revenue, and Badger Wind Farm contributed $3.2 million of earnings. Retail sales volumes rose 9.3%; sales to data-center customers rose 18.4%. Operating revenues in the electric business were $142.3 million.

North Dakota interim electric rates reflecting an annual increase of $26.3 million, subject to refund, became effective Sept. 1, 2026, while a June 30 rate case requested a $34.5 million annual increase. Montana interim rates of $10.4 million have been in effect since April 1, 2026, subject to refund, with a $10.0 million settlement pending. Wyoming final rates of $5.8 million became effective April 1, 2026.

Natural gas distribution recorded a seasonal net loss of $20.7 million, wider than the $18.2 million seasonal loss a year earlier. New rates in Idaho and Washington contributed $6.5 million of additional revenue and retail sales volumes rose 7.1%, but those benefits were more than offset by higher operation and maintenance expense, including payroll-related costs and the $2.1 million net-of-tax Knott Landfill loss, plus higher interest expense and lower returns on nonqualified benefit plan investments. Idaho final rates of $13.0 million have been in effect since Jan. 1, 2026, and Oregon final rates of $12.2 million became effective Oct. 31, 2026.

The pipeline segment earned $13.1 million, compared with $16.8 million a year earlier. Results were affected by higher operation and maintenance expense, Bakken East advisory costs that did not qualify for capitalization, and lower interruptible transportation volumes and storage injections. Those effects were partially offset by higher demand revenue from short-term contracts and from the Minot Expansion and Line Section 22 Expansion. WBI Energy’s May 29 FERC rate case seeks a $31 million annual revenue increase; FERC accepted and suspended the proposed rates on June 30, with rates to become effective Dec. 1, 2026, subject to refund.

Estimated 2026 capital expenditures of $594 million include $102 million for electric, $327 million for natural gas distribution and $165 million for pipeline, reflecting increased pipeline investment after the Bakken East decision. The company said it is evaluating financing structures, including potential participation of financial or strategic investors, while expecting WBI Energy to retain majority ownership and operational control. Long-term earnings-per-share growth remains targeted at 6% to 8%.