Armstrong: West-to-east natural gas pipeline will help unlock potential of ND communities
Whoever said “you can never have too much of a good thing” likely never faced a dilemma like the one we have with natural gas in North Dakota.
On one hand, we have communities that need natural gas to grow and support economic development but have no way of getting it.
On the other hand, natural gas production in western North Dakota continues to set records as the Bakken matures, with no large-scale pipeline to move this stranded asset from west to east.
Fortunately, a solution is within reach.
The North Dakota Industrial Commission recently took a crucial step toward bridging the natural gas gap between east and west.
We voted to begin contract discussions with WBI Energy Transmission for the state to purchase transport capacity on a proposed natural gas pipeline that would run from McKenzie County in the heart of the Bakken to Mapleton and Ellendale in southeastern North Dakota.
This is no small commitment: To support WBI building the pipeline, the state would backstop up to $50 million of pipeline capacity per year for up to 10 years, for a possible investment of $500 million. As WBI secures commitments from private businesses to use the natural gas — and they’re already lining up — the state will transfer its pipeline space to those businesses.
In short, we’re taking an excess energy product that’s stranded in the Bakken and moving it across the state to people who need it.
That means a cheaper source of power and heat for homeowners and businesses in our communities as they look to grow their economies.
It means oil producers can maintain and increase their output, versus having to curtail production to stay within state goals for reducing the flaring of natural gas at the wellhead.
And it means the abundant oil and gas tax revenues that support everything in North Dakota from schools, hospitals and highways to airports, tax relief and the Legacy Fund, will continue to flow into state coffers for decades to come. Since 2015, the state has collected more than $22.7 billion in oil and gas tax revenue.
As I said in my first State of the State address in January: For as valuable as natural gas is, it’s actually a detriment to our state budget because it limits our ability to grow. To reduce flaring and increase oil production, we need to move our gas, and we must work with industry to build out pipeline infrastructure.
The Commission’s vote sends a strong signal to the private sector that North Dakota is open for business and serious about offloading our natural gas. We appreciate the current Legislative Assembly authorizing the $50 million per year, expanding on a similar proposal from the 2023 session.
This comes at an exciting time for our economy, with major projects in the agriculture and technology sectors proposed or coming online in North Dakota, including value-added processing plants and data centers.
One need they all have in common is power. And with this west-to-east pipeline, North Dakota will be even better positioned to meet that demand — helping our communities reach their full potential and paving the way for a more prosperous and energy-secure future for our citizens.
Kelly Armstrong is the 34th governor of North Dakota and chair of the state Industrial Commission.