Dalrymple: North Dakota needs more pipelines

As emergency crews respond to the latest oil train derailment in North Dakota, the state’s governor called for the quick development of more pipeline capacity.

Six tank cars carrying Bakken crude oil through Heimdal, N.D., derailed Wednesday morning. The flames forced the evacuation of the town of less than 50 people. No injuries were reported and cars not involved in the derailment were moved to a secure location.

North Dakota’s crude oil production has increased to the point that there’s not enough pipeline capacity to handle the boom. That means energy companies are relying more on rail to take up the slack.

North Dakota Gov. Jack Dalrymple said that, while the latest incident shows an urgent need for improved rail safety, it also highlights the shortage of options for oil transit through the state.

“Pipelines offer the safest mode of crude oil transportation so we must also develop greater pipeline capacity,” he said in a statement.

In March, the governor said rail traffic may drop off once new pipeline infrastructure comes online. Three pipelines — Sandpiper, Dakota Access and Upland — should be in service by 2018 and provide 895,000 barrels per day in new capacity.

The governor in early April secured assistance from the federal Pipeline and Hazardous Materials Safety Administration to help fund university research in pipeline safety. A bill signed into law by Dalrymple last month strengthens the state’s regulatory oversight on pipelines for crude oil and so-called produced water.

Officials from BNSF are investigating the Heimdal incident alongside state and federal authorities.


Working Together

A bill passed by the North Dakota state legislature has shown that while effective negotiation and genuine consensus building might be the most difficult thing to accomplish in politics,  positive change can happen if and when it does occur. A working group comprised of landowners, industry representatives, and government officials collaborated on a new pipeline restoration and reclamation oversight program, which will affect all future energy infrastructure projects in the state, including the Dakota Access Pipeline. As Senator Jessica Unruh explained in her recent op-ed:

 “The program is multifaceted. As it is implemented, it will provide support to landowners through technical assistance and education outreach regarding pipeline reclamation. If any pipeline reclamation issues exist and persist, landowners can work with local individuals hired by the Ag Department to help resolve the concerns or problems. This will help to ensure proper reclamation practices are completed on pipeline corridors. The hope is that this will help expedite proper installation of pipelines throughout North Dakota. Pipelines reduce rail traffic and delays, get more trucks off our roads, and help reduce natural gas flaring.”

Ensuring that landowners in our region have the support and resources they need when granting easements is critical to making sure that energy infrastructure projects can proceed safely, responsibly, and efficiently.  As Senator Unruh noted, cooperation and teamwork can provide mutual benefit from our region’s rich energy resources, and this program is a critical part of that vision.


Counties prepare for possibility of Bakken pipeline

Southeast Iowa counties are bracing for the very real possibility of the Bakken crude oil pipeline cutting through their jurisdiction.

The Jefferson County Supervisors met with two engineering companies Monday morning to discuss required services if the pipeline is approved.

If the pipeline is eventually approved by the state, the engineering company selected by the county would be overseeing construction and ensure farmland is handled correctly.

“If it is approved and if it does come through Jefferson County, then we have a responsibility as a board to make sure that we have a consultant in place to protect the best interest of Jefferson County and the interest of the landowners that will be affected,” said Lee Dimmitt of the Jefferson County Supervisors.

Demmitt stressed that there has been no letter of intent signed with an engineering consulting company.

The construction and final route of Bakken oil pipeline is pending approval from the Iowa Utilities Board; made up of three individuals appointed by Gov. Terry Branstad.


Our View: Western North Dakota’s oil story is far from told

The story of the Bakken oil boom was — and is — the biggest economic tale in the history of North Dakota and is arguably one of America’s most important stories of this young century.

The recent slowdown is not the end of the story, nor will it be the beginning of something else. Instead, it’s the continuation of what now is the post-boom stage and establishment of North Dakota’s energy industry.

The excitement of unprecedented growth in western North Dakota brought stories of individual, business and community success, and gave the state a financial reserve that has been the envy of the nation. However, with opportunities came challenges — skyrocketing rents, empty store shelves, traffic jams and sophisticated crime the likes of which were rarely, if ever, seen in the area.

Now the story is about falling oil prices and the effect it has on everything and everyone in western North Dakota.

Over the past month, The Press has run an ongoing series titled “What’s Next? The oil slowdown in western North Dakota.” What we’ve found is that many people in the Bakken, and southwest North Dakota in particular, are taking deep breaths and welcoming the slowdown in activity. To some others, however, it signaled an end to another boom — a bust.

Stories of opportunity have been replaced with those of the challenges for individuals, businesses and the state. Rents may be dropping, but many folks have lost their jobs and have gone back to from where they came.

Two years ago, North Dakota legislators debated how best to spend record-breaking tax revenues. This winter, they sharpened their budget pencils and used erasers to try and best to meet everyone’s needs as revenue fell.

The price of oil is the result of the global economy and not a reflection of the American industry.

Energy development in our country has arguably been the lone bright spot of our economy since the recession began. Remember, this all happened despite the White House doing almost everything in its power to curtail the very real potential of American energy independence — something that was almost unthinkable until this decade.

Removing the trade embargo on crude oil and authorizing the Keystone XL pipeline would go a long way toward strengthening the industry and restoring lost jobs. Realistically, however, neither will move forward as long as the current administration occupies the White House.

Nonetheless, development will continue as long as there is a need for oil. Value-added products and plants, like the Dakota Prairie Refining diesel topping plant west of Dickinson — as well as future fertilizer and plastics plants elsewhere in the state — will add stability to North Dakota’s oil industry.

The price of oil rises and falls like any other commodity, and that’s nothing new for the industry, which knows how to take it all in stride. Short-term low oil prices help make good companies great, encourages consolidation, and can be devastating to businesses that refuse to show high concern for their environment or the safety of their employees.

The Dickinson Press, The Drill and Forum News Service will continue to tell the story of what’s happening in western North Dakota, be it flattering or unflattering. Our responsibility is to report and give an honest appraisal of a story that continues to test the imagination.

In short, we want to help you answer the question, “What’s next?”

The recent drop in oil prices has certainly changed the story that is the Bakken. But in no way has it ended the story.


Former ICC Commissioner: Pipelines beneficial to Illinois

The American energy revolution currently underway in our country has not only made us a leading producer of oil and natural gas, it has the potential to reshape world politics. But closer to home, the energy boom has created opportunity and employment for many Americans, strengthening the middle class and making possible a renaissance of American manufacturing. Illinois is one of the states in our region that has the potential to benefit from the abundance of energy. As the former head of the Illinois Commerce Commission, Stanford Levin, wrote:

 “Energy Transfer Partners is proposing a pipeline, known at the Bakken Pipeline, to carry oil from North Dakota to Patoka, in southern Illinois. This will provide construction jobs in Illinois and will also contribute to the economic development of southern Illinois.”

Mr. Levin rightly notes that in order  to capture the benefits of the state’s energy abundance, new pipelines will be needed. Intrastate pipelines, as well as major interstate projects, such as the Dakota Access Pipeline will help bind our region together and help us take full advantage of the benefits of domestic energy production.


Guest commentary: Pipelines beneficial to Illinois

Illinois needs more oil pipelines for two reasons. Pipelines provide a safer and environmentally friendlier way of transporting oil to and through Illinois compared with alternatives like rail or trucks. Pipelines, especially those that permit the extraction of oil in Illinois or that bring oil to refineries in Illinois, provide jobs and contribute to economic growth in the state.

Updating our energy infrastructure to keep pace with a new reality of energy abundance should be a top priority. Modernizing and expanding pipelines generates billions of dollars in capital improvements.

For example, the pipeline that brings Canadian oil to the Wood River refinery in Roxana has provided construction jobs and permanent jobs at the refinery.

Enbridge is tripling the capacity of its existing Line 61 pipeline. This pipeline brings Canadian oil from Superior, Wis., to a point south of Chicago and then on to Oklahoma. This capacity expansion does not involve constructing a new pipeline but only boosting the capacity of the existing pipeline.

Energy Transfer Partners is proposing a pipeline, known at the Bakken Pipeline, to carry oil from North Dakota to Patoka, in southern Illinois. This will provide construction jobs in Illinois and will also contribute to the economic development of southern Illinois.

Furthermore, and perhaps most importantly for southern Illinois economic development, there is the New Albany shale formation. Companies have begun to exploit the oil and natural gas that can be recovered from southern Illinois. But to capture the benefits, similar to those in North Dakota, Texas, Pennsylvania, and elsewhere with oil and gas recovery from shale formations, pipelines will be needed. This oil and gas will need to be moved to refineries and processing facilities, and pipelines offer the best option.

Pipelines can be operated safely and are environmentally superior to the alternatives.

It is foolish to think that if pipelines are not built, oil consumption will decrease. That is simply unrealistic. Either more oil will be shipped by rail or truck in the absence of pipelines, an environmentally less attractive option, or we will import more oil from places like Venezuela and the Middle East. The risk of relying on such countries should raise serious concerns.

Canada, on the other hand, will produce oil, and either it will be exported to the U. S. or to somewhere else in the world. Given that choice, we should import any needed oil from Canada. While no transport method is 100 percent, pipelines make the most sense.

We need to weigh realistic options for energy infrastructure and make sure they work as intended, not insist on some wished-for innovation that doesn’t exist. When doing that, oil pipelines look like the most attractive option, and they can contribute to job creation and economic development in Illinois and, particularly, in southern Illinois.

By streamlining the permitting process for pipelines — and avoiding regulatory overreach that raises infrastructure costs without delivering meaningful improvements — we can ensure that Illinois has an energy infrastructure system to match our status as a leading energy producer.


PHMSA Looks to the Future

The Pipeline and Hazardous Materials Safety Administration (PHMSA), which is tasked with inspecting our nation’s pipelines, is looking to the next generation of scientists to tackle the challenges that a rapidly expanding energy infrastructure can present.  As Bakken Shale wrote:

 “In addition to hiring more than 100 new safety inspectors this year, the PHMSA will also be awarding $ 2 million in grants for students and faculty to research pipeline safety solutions. These grants designed to expose new engineers and scientists to the technical side of the energy transportation sector.”

We applaud the actions PHMSA is undertaking to make sure that the next generation of energy projects, such as the Dakota Access Pipeline, is as safe and environmentally friendly as our capabilities allow it to be. While pipelines have consistently proven themselves to be the safest mode of transporting energy, we should always look to incorporate new technologies and solutions to improving our energy infrastructure.


An Investment in Safety

North Dakota is taking steps to insure that its energy transportation system remains safe, reliable, and dependable. While pipeline and railroad regulation is traditionally the domain of the federal government and the Pipeline and Hazardous Materials Safety Administration (PHMSA), North Dakota’s governor has signaled his commitment to ensuring the integrity of the state’s energy transportation system. As The Dickinson Press recently reported:

“Dalrymple and the Public Service Commission have also proposed a state-run railroad safety program and pipeline integrity program “that would complement federal oversight in North Dakota,” according to the release. The proposal would cost North Dakota $1.4 million for three position to inspect railroad tracks. Another three state employees would inspect pipelines that transport oil and other liquids to market.”

The decision to bring on more safety personnel has drawn praise from around the state, which is warranted. We believe that expanding the number of full time pipeline safety inspectors will have the double benefit of making existing pipelines safer, while ensuring that planned projects as the Dakota Access Pipeline are built on schedule, while fulfilling all of the stringent safety requirements. This measure would protect the public, help the industry, and most importantly of all, safeguard our region’s natural resources.


Clearing our Crowded Rail Roads

America’s freight rail system has been described as “one of the unsung transport successes of the past 30 years.” Productivity has nearly doubled, energy efficiency has skyrocketed, and rates are nearly half of what they were in 1981. However, our region’s rail networks are facing challenges so far unprecedented in recent history.

The energy revolution occurring in the Midwest is currently unlocking vast amounts of resources, creating jobs, helping our manufacturing sector stay competitive, and making our country more energy independent. However, a large percentage of the energy currently produced is currently being transported to market by rail as rail capacity is squeezed.  Demand for space on our region’s rails has simply not kept up with supply.

The stress placed on our rail system has caused unfortunate mistakes. Our region has seen the results of these accidents first hand.  Moreover, our region’s rail infrastructure is facing the prospect of still further increases in volume and frequency of energy transports. Between February and March, Sioux City has recorded a nearly 100% jump in the amount of oil trains coming through the city of over 80,000, carrying around 1 million gallons of crude oil each.

While the oil trains keep rolling, our region’s farmers are left with the challenge of getting their products to market, with backlogs of nearly 1,000 trains waiting to ship grain and other products being recorded within the past year. A recent letter to BNSF shareholders stressed the “disappointment” they caused some of their customers by not being able to accommodate their shipments.

While our freight rail system continues to be an example for the rest of the world, we believe that diversifying our energy infrastructure will mutually benefit energy producers, farmers, and the general public. Proposed pipeline projects in our region, such as the Dakota Access Pipeline are the key to meeting these challenges. Oil pipelines have been and continue to be the safest means of transporting energy, while doing so for a fraction of the price.

Expanding our pipeline infrastructure will increase safety, reduce energy costs, benefit our region’s farmers all while reducing the strain on our region’s rail infrastructure.


Agronomists to monitor pipeline project

Recent discussions regarding the Dakota Access Pipeline have raised important questions from landowners about agricultural impact during and after construction of the proposed project.

My colleagues and I with Key Agricultural Services, Inc. and Duraroot will serve as independent monitors and inspectors during the construction and reclamation process for the Dakota Access Pipeline project. We are poised to act as a liaison between the project’s developers and landowners, ready to help farmers answer their questions about how their land will be returned to its pre-construction productivity.

We have decades of local experience in land stewardship and in working with the developers of infrastructure projects like Dakota Access. Our experience is local — we understand how to manage and mitigate risks to the region’s land and know how to work with landowners to ensure their questions are answered and their unique, individual concerns are addressed.

To minimize the impact on agricultural land during the construction phase, this project will segregate the valuable topsoil — placing it aside intact during construction and returning it intact upon completion — to ensure maximum yield after construction. Our company will also inspect the construction process and work with landowners during the right-of-way process to discuss the effect upon agricultural yields.

After construction, we will work with landowners on the reclamation process to return the land to its pre-construction state, if not better. We take pride in communicating openly with landowners throughout the entire process and we are committed to continuing our company’s reputation for transparency to ensure landowner needs are met.