Midwest carbon-capture pipeline could be delayed after eminent domain ban in South Dakota

SIOUX FALLS, S.D. (AP) — The company behind an $8.9 billion carbon-capture pipeline proposed for five Midwestern states said Wednesday it wants to indefinitely delay its plans after South Dakota passed a law limiting its ability to acquire land for the project.

But even as it filed a motion to suspend its pipeline permit application timeline with the South Dakota Public Utilities Commission, the Iowa-based Summit Carbon Solutions said it remains committed to the pipeline.

Summit attorney Brett Koenecke said the action was needed because the legislation approved by South Dakota lawmakers and quickly signed into law by the governor changed the company's ability to survey the route.

“The resulting delays in obtaining the surveys mean that the timelines involved in Commission action on this application are unrealistic,” Koenecke wrote in the motion. If the commission approves the motion, they can set a new deadline for the permit application.

The proposed 2,500-mile pipeline would carry carbon emissions from ethanol plants in Iowa, Minnesota, Nebraska, North Dakota and South Dakota to be stored underground permanently in North Dakota. By lowering carbon emissions from the plants, the pipeline would lower their carbon intensity scores and make them more competitive in the renewable fuels market.

The project had approvals in Iowa, Minnesota and North Dakota. But in South Dakota, a new law banned the use of eminent domain — the government seizure of private property with compensation — specifically for carbon-capture projects.

The eminent domain bill sponsor Republican Rep. Karla Lems said Summit is “trying to get their feet back under them” after the eminent domain ban.

Summit's move was “generally good news” for Frank James, director of advocacy group Dakota Rural Action, which opposed allowing eminent domain for the project.

“It means the work that we did at the legislature with our allies was impactful,” he said. “It clearly shows the citizens of South Dakota really question these false solutions to climate change.”

Tad Hepner, vice president of strategy and innovation at the Renewable Fuels Association, disagreed, saying stopping Summit in South Dakota would put ethanol producers in the state at a competitive disadvantage to out-of-state plants connected to the pipeline.

“We don't want to see haves and have-nots,” he said. “We want as many ethanol producers to be able to sequester their CO2 as possible.”

North Dakota Gov. Kelly Armstrong said Tuesday he doesn’t know how Summit will get its pipeline into North Dakota given South Dakota’s eminent domain ban.

Armstrong said he is concerned because officials and industry leaders were hopeful of eventually using carbon dioxide to extract oil. North Dakota is the No. 3 oil-producing state in the country, producing about 1.2 million barrels of oil per month.

Summit has already spent more than $1 billion on the project, Summit spokesperson Sabrina Zenor said. Despite the South Dakota suspension, “all options” are still on the table, the company said.

"Summit Carbon Solutions remains committed to working through this process and advancing the project in states that support energy and innovation," the company said in a statement.

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Dura reported from Bismarck, North Dakota.