North Dakota gas plant to be redeveloped for clean energy

Gas valves Source: iStock/RYosha

Bakken Energy and Mitsubishi Power Americas on Monday announced they are acquiring a financially troubled synthetic natural  gas plant in western North Dakota and plan to redevelop it to produce renewable energy.

The companies said the deal to purchase the Great Plains Synfuels Plant from Dakota Gasification Co. is expected to be finalized by next April. Dakota Gasification is a subsidiary of Bismarck-based Basin Electric Power Cooperative. Terms of the deal were not disclosed.

The plant near Beulah is part of a proposed hub announced in June to produce clean hydrogen, which has a variety of uses including powering vehicles and energy generation. Republican Gov. Doug Burgum has hailed the project a key part of the state's plan to become carbon neutral by 2030.

Officials said the hub consist of facilities that produce, store, transport and consume the carbon-free fuel. The hub will focus on the production of blue hydrogen, which is derived from natural gas with the carbon dioxide emissions captured, and sequestered underground or used for enhanced oil recovery.

Officials said they hope to connect the hub by a pipeline to other hubs throughout North America.

The hydrogen for the project will come from natural gas produced in North Dakota's oil fields or from gas from the Dakota Gasification plant, or a mix of both, officials have said.

The hulking plant on the prairie has been struggling to compete in recent years with cheap natural gas made available by hydraulic fracturing in western North Dakota's oil patch.

The plant was built in response to the energy crisis of the 1970s to make natural gas from lignite, a low-grade coal that is abundant in North Dakota. The plant also has produced fertilizer and some liquid fuel products.

It began producing gas in 1984, but the factory's original owners abandoned it about a year later, and the Energy Department foreclosed. Basin bought the plant northwest of Bismarck in 1988 for $85 million and agreed to pass on some tax breaks and share revenues if natural gas prices were high enough to trigger the payments.

The Energy Department, which guaranteed $1.5 billion in construction loans for the factory, has recouped its money when unused tax credits are calculated, the company said. Basin made its final payment to the federal government in 2010.

© 2021 The Canadian Press

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