POET, Magellan Cancel 1,800-Mile Ethanol Pipeline Project

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Researched by Industrial Info Resources (Sugar Land, Texas)--POET LLC (Sioux Falls, South Dakota) and Magellan Midstream Partners LP (NYSE:MMP) (Tulsa, Oklahoma) have cancelled plans to install an 1,800-mile ethanol pipeline that was to transport fuel ethanol from the Midwest to Northeastern markets. The companies have cited lack of funding from the Department of Energy as the reason for cancelling the project.

The $4 billion pipeline was to run from Davison County, Iowa, to Linden, New Jersey. The 36-inch diameter pipe was rated to move 240,000 barrels per day of ethanol to East Coast markets and was expected to be completed in 2014.

The pipeline was deemed to be more costly than traditional delivery methods of rail and truck delivery. Approximately three-quarters of fuel ethanol is shipped via rail. The line would have been a safer and more reliable method of transporting the fuel and could have served markets not serviceable by rail or barge.

POET said they did not perform a lot of due diligence on the project before walking away. The only ethanol pipeline presently in service is operated by Kinder Morgan Energy Partners LP (NYSE:KMP) (Houston, Texas). The 85-mile stretch of Florida pipeline runs between the Port of Tampa and Orlando.

Industrial Info's databases provide a comprehensive outline of all current development activities in the emerging alternative fuels market. Our North American Biodiesel Database covers 149 operational plants and 95 plants in development. Our North American Ethanol Database covers 214 plants currently in operation and 106 plants in various phases of development. Our North American Wood Fuel Pellet Database includes 67 operational plants producing greater than 25,000 tons annually, and 38 projects in progress.

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View Project Report - 029001466

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