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Iowa Regulators Approve ETP's Dakota Access Pipeline

Iowa regulators on Thursday approved, with landowner protections, their state's part of the proposed 1,154-mile Dakota Access Pipeline, which would move Bakken Shale crude oil through four states. If built, the pipeline eventually could move up to half of the Bakken's 1 million b/d production to various markets.

Iowa Utilities Board (IUB) members said a permit will not be issued to Energy Transfer Partners' (ETP) Dakota Access LLC until additional terms and conditions in its order are met by the pipeline company.

ETP must maintain liability insurance; file guarantees of remediation of damages; modify easements, and continue to make the same easement offers to landowners, among a list of other measures. Earlier this month, an ETP spokesperson said the pipeline project continues to move forward and has obtained more than 88% of the easements needed to cross the nearly 3,700 separate properties along the complete pipeline route. On a state-by-state basis, as of March 11, the percentages vary from 97% in North Dakota to 82% in Iowa, with South Dakota and Illinois at 93% and 92%, respectively.

The IUB last month concluded four days of public hearings and set an open session meeting for Thursday (see Shale DailyMarch 3).

In making its decision, the IUB applied "a statutory balancing test" to conclude that the public benefits of the pipeline outweigh costs with the added conditions. Among the benefits the regulators found are the safety advantages of oil pipeline transportation and the estimated $787 million worth of jobs/economic benefits during the construction period.

Under Iowa law, receipt of the permit will allow the use of eminent domain across any parcels where the company has been unable to negotiate voluntary easements, but the IUB limited the pipeline builder's use of the power to "minimum rights necessary for safe construction and operation."

NGI's Shale Daily contacted ETP for the company's reaction to the IUB approval, but there was no immediate response.

Regulators in North and South Dakota, and in Illinois already have approved the line (see Shale Daily, Jan. 25; Dec. 29, 2015). Iowa approval was the final permitting hurdle. Separately last Tuesday, the Sioux Falls City Council approved an easement for Dakota Access after first rejecting one. The approval avoided an eminent domain legal fight with ETP, whose attorney said the company already has started eminent domain proceedings on other parts of the pipeline route.

Following a Feb. 19 mandate from the board, staff has been crafting an order regarding the pipeline case [HLP-2014-0001].

The $3.8 billion Dakota Access would have 100,000 b/d of capacity for its initial segment to the Stanley and Ramberg tank terminals in North Dakota, from which takeaway capacity would be expanded to carry up to 600,000 b/d between Watford City's tank terminal and the South Dakota border.

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