The Obama administration has approved a presidential permit to build an 80-mile-long leg of the Vantage Pipeline in North Dakota, Sen. John Hoeven, R-N.D., announced Tuesday.
The completed pipeline will be 430 miles and will carry up to 60,000 barrels per day of ethane natural gas from Tioga through Saskatchewan, to facilities in Empress, Alberta, Canada.
Hoeven said approval for Keystone XL has been delayed for five years, and now the State Department has approved a major pipeline project in just three. He said Keystone XL, like the Vantage Pipeline Project, would mark another major step toward North American energy security.
"The Vantage Pipeline is another major piece of infrastructure that will help us build our North American energy security partnership with our closest friend and ally Canada," Hoeven said. "The project illustrates clearly how modern pipelines can create jobs, make us more energy secure, and do so with good environmental stewardship. It will enable us to reduce flaring in North Dakota and also reduce emissions where the natural gas is used by industry."
"We thank Senator Hoeven for his substantial and sustained efforts in assisting Vantage in navigating the process that led to a presidential permit for this important international pipeline project," said David Schmunk, chief operating officer of Mistral Energy US Inc., the limited partner of Vantage Pipeline US LP. Schmunk added that, "The ability to transport ethane for use in the plastics industry will provide an important new revenue source for gas producers in North Dakota and will also allow producers to reduce flaring."
The Vantage project will require about 400,000 man hours to construct, inject $300 million into the U.S. and Canadian economies, expand the market for North Dakota natural gas, create financial opportunities for service providers and increase revenues to local cities and counties along the route.
The new pipeline will carry ethane gas, a component of natural gas that is used as a feedstock by the petrochemical industry to produce plastics, rubber, detergents and other consumer products.
Vantage Pipeline is partnering with Alberta's NOVA Chemicals and North Dakota's Hess Co. in Tioga, which is now producing ethane at levels that make it economically feasible to sell it to consumers. The project will mark the first time that liquids from the Williston Basin will flow north and tie into existing Alberta infrastructure and industry.
"This is good news for North Dakota and further demonstrates the richness of Bakken gas and the strong demand for its byproducts including ethane, methane, propane, and butane both domestically and internationally," said Rep. Kevin Cramer, R-N.D. "There is huge potential for North Dakota to leverage its supply of these hydrocarbons, which are key ingredients in the petrochemical industry, to further its position in value-added products like plastics. It is good to see President Obama and the State Department recognizing the value of applying free trade to our vast energy and industrial resources, and we can only hope they will apply this logic to other projects including Keystone XL."
Hoeven has worked to advance the Vantage Pipeline permit since the fall of 2010, when Vantage applied to the State Department for a permit application. In a 2011 letter, he pressed Deputy Secretary of State William Burns to make a timely decision on the pipeline, and subsequently helped to resolve outstanding tribal concerns about the preservation of historical and cultural resources.
This spring the senator again pressed for completion of the State Department's Final Environmental Assessment and Finding or No Significant Impact because the company was under a time constraint. It needs to complete the project by the fall of 2013 to meet the terms of its contract with the Hess plant near Tioga.