Richardson Announces Agreement To Keep Great Plains Plant Operating

Bismarck, ND - U.S. Energy Secretary Bill Richardson, in Bismarck today at the invitation of Senator Byron Dorgan, announced a major agreement that will help keep North Dakota's pioneering Great Plains Coal Gasification Plant operating.

	The Great Plains Coal Gasification Plant near Beulah, North Dakota

"This agreement secures the long-term future of a facility that is vital to North Dakota's economy and to the 700 North Dakota citizens employed there, and hundreds more in adjacent coal mines and regional businesses," Secretary Richardson said. "It strengthens the continued operation of the biggest employer in the heart of North Dakota's energy industry, and it provides financing for a first-of-a-kind project that will demonstrate a way we can turn a combustible byproduct into a commercially viable commodity."

At a mid-day news conference Richardson also announced that the Department of Energy will award $300,000 to the Energy and Environmental Research Center (EERC) in Grand Forks to study the feasibility of burning certain types of biomass material in electric power plants. Positive results from these tests will enable the siting of ethanol facilities at power plants across the United States.

"The EERC researches alternative fuels, energy efficiency, air pollution control technologies, water management, nuclear waste cleanup and the development of state-of-the-art analytical techniques for air, water and soil," Richardson noted. "I'm especially pleased to award this contract because its initiatives parallel the Department of Energy's history and priorities."

The Great Plains Coal Gasification Plant, located 75 miles northwest of Bismarck near the town of Beulah, is the only plant operating in the United States that converts coal into a pipeline quality substitute for natural gas. Built under a federal loan guarantee in the early 1980s, it currently supplies synthetic natural gas to nearly 300,000 homes and businesses in the Midwest and eastern United States.

In order to increase revenues, Dakota Gasification Company -- the Basin Electric Power Cooperative subsidiary that owns the plant -- has sought markets for the carbon dioxide produced by the plant. (Currently, the carbon dioxide is released to the atmosphere.)

Injected into oil reservoirs, however, carbon dioxide can force additional crude oil to the surface. A Canadian oil producer has indicated a willingness to purchase the carbon dioxide for an enhanced recovery project if Dakota Gasification would agree to finance the construction of a 205-mile pipeline from the plant to the oil field.

The agreement Secretary Richardson announced provides the financial arrangements necessary for the pipeline to be built, and to make other environmental improvements at the Great Plains facility. It will allow the plant's owners to convert federal tax credits into the necessary capital to build the pipeline and improve the plant's environmental performance.

This agreement will help Dakota Gasification Company diversify its product line, thereby strengthening its position in today's tough energy market. The tax credit financing will also allow Dakota Gasification Company to complete improvements and operate the plant in compliance with tough environmental standards required by the operating permit from the North Dakota State Health Department.

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