(PRIMGHAR, IA) - Two companies are eyeing Northwest Iowa for a dedicated ethanol pipeline that would carry fuel-grade ethanol to the eastern seaboard. The proposed pipeline could carry 250,000 barrels of ethanol.

"The opportunity to be on the front end of this project is a great opportunity for O'Brien county," says Kiana Johnson with the O'Brien County Economic Development Corporation. Magellan, a pipeline company is partnering with Poet, which owns dozens of area ethanol plants in the feasibility study to see whether this project is economically viable. Johnson invited the two companies to primghar, Iowa to show the pair that O'Brien county could be an ideal spot to start the pipeline.

The 1,700 mile line could connect directly to dozens of ethanol plants, removing the need for trucks or rail for transportation. Poet representatives say that could cut down on production costs.

Johnson says the pipeline could boost local ethanol sales, create jobs, and have a ripple effect on area businesses. Magellan says the project could create 25,000 jobs nationwide, but had no figures for Iowa, specifically.  

There is, however, a major financial hurdle to the project. Both companies agree federal help is a must for the potentially $3.5 billion proposal. "the department of energy offers a loan guarantee program which we believe needs to be modified in a way that would allow a large scale pipeline to qualify for the program," says a Magellan official.

That legislation is currently before congress.

courtesy KMEG 14 News