Two US pipeline companies, Magellan Midstream Partners and Buckeye Partners, have begun a feasibility study for the first dedicated US ethanol pipeline. The pipeline will bring biofuel produced in the Mid West to distribution terminals in the highly populated, car infested North East. ‘We believe the proposed pipeline is a unique and innovative solution to meeting the growing need for renewable fuels in the North East,’ said Don Wellendorf, president and ceo, Magellan.
The study is expected to be completed in H2 2008, but construction of the pipeline would take several years. ‘This feasilibity study will evaluate the possible use of existing rights-of-ways and workforces as well as other synergies and resources that our companies have,’ said Eric Gustafson, Buckeye’s senior vice president and chief operating officer.
The proposed 10m gal/day pipeline would gather ethanol from production facilities in Iowa, Illinois, Minnesota and South Dakota for delivery to major markets in Pittsburgh, Philadelphia and New York harbour. Buckeye already has 24 terminals with ethanol blending and is currently investing in two new facilities at terminals in the North East. Magellan currently blends ethanol at 36 of its petroleum products terminals and is investing in six new ethanol blending systems in the Mid West and South East.
The cost of the 1700 mile pipeline is preliminarily estimated to be in excess of $3bn, and the partners say that government support will be critical for the project to proceed, as will changes in federal tax laws to ensure the pipeline will be treated the same as refined petroleum products. The key technical issue is to maintain the ethanol in an anhydrous state to prevent possible corrosion. The companies are said to be involved in joint research with the US Department of Transportation and pipeline industry groups.