North Dakota’s Industrial Commission has extended the deadline for pipeline companies to apply for a $150 million grant for a natural gas pipeline that would run from the Bakken oil patch to eastern North Dakota.
The deadline is now Dec. 15, Prairie Public reported.
An Aug. 15 deadline passed with no applications, but state Pipeline Authority Director Justin Kringstad said that doesn’t mean companies aren’t interested.
“The interest level today is just as strong as it was just about a year ago when this concept was put forward,” he said
A west-to-east pipeline — which officials have estimated could cost up to $1 billion — would be a way to help reduce wasteful flaring of excess natural gas as Bakken gas production increases, according to Kringstad. It also could provide gas to eastern industrial customers looking for supply.
Kringstad said there are challenges including construction inflation. And he said it takes a number of players to make something like this happen.
“You have to have upstream players on the supply side,” Kringstad said. “You have to work with downstream players.”
Upstream involves companies that extract or produce raw materials such as natural gas. Downstream refers to the distribution of the product.
Kringstad said the upstream and downstream players might have different timelines and needs.
“So it’s coordinating who needs gas, when and where, who has gas, when and where,” he said. “And those things take sometimes years to come together.”
Kringstad said the economic potential is still there if the pipeline is built.
“There’s a lot of large ag-processing potential,” Kringstad said. “There’s a lot of energy potential we’re seeing pop up, whether it’s energy generation or other uses.”
The 2021 Legislature set aside the $150 million in seed money for the project, with $10 million of it designated for a connection to Grand Forks from the Viking Pipeline in Minnesota.
The grant money stems from the allocation awarded to North Dakota under the American Rescue Plan Act, a federal stimulus program designed to help states emerge from the coronavirus pandemic.
North Dakota produced just under 3.06 billion cubic feet of natural gas per day in June, up nearly 10% from May, according to the state Oil and Gas Division. The state’s record production was 3.15 billion cubic feet per day in November 2019.
The industry in June captured 94% of gas, the same as in May, exceeding the state’s 91% target. The rest was flared off at well sites due to a lack of access to pipelines and processing plants.