South Dakota regulators deny permit for Navigator pipeline

PIERRE, S.D. — In a unanimous decision, the three-member South Dakota Public Utilities Commission on Wednesday rejected Navigator CO2’s application for a permit to construct the Heartland Greenway carbon capture pipeline in South Dakota.

The commission also unanimously refused the company’s request to preempt county pipeline setback ordinances. The ordinances mandate minimum distances between pipelines and dwellings, schools and other places.

Navigator’s proposed project also includes building about 810 miles of underground pipeline in Iowa. It has proposed that the Iowa Utilities Board schedule evidentiary hearings on its proposed route in late 2024.

In public comments during Wednesday’s meeting at the South Dakota Capitol, Commissioner Kristie Fiegen listed a number of reasons for denying the permit, including what she described as a failure by the company to adequately disclose carbon dioxide plume modeling and a failure to provide timely notices to some of the landowners along the proposed route. The commission conducted a hearing on the permit application from July 25 to Aug. 8.

“The burden of proof is on the applicant,” Fiegen said.

That burden, she added, includes ensuring the project will not negatively impact the social, environmental and economic well-being of the public. Fiegen made the motion, which was supported by the other two commissioners, to deny the permit.

Opposing sides react

Navigator, which is based in Omaha, issued a statement after the meeting.

“While we are disappointed with the recent decision to deny our permit application in South Dakota, our company remains committed to responsible infrastructure development,” the statement said. “We will evaluate the written decision of the Public Utilities Commission once issued and determine our course of action in South Dakota thereafter.”

South Dakota’s denial of a permit for Navigator follows North Dakota’s recent denial of a permit for another carbon dioxide pipeline project, proposed by Summit Carbon Solutions, which would also cross into South Dakota. Summit has already altered its North Dakota route and is seeking reconsideration of that decision. Summit’s South Dakota permit hearing is scheduled to begin Monday, and a weekslong hearing on Summit’s proposed route in Iowa is in progress.

Navigator has not yet pursued eminent domain to obtain land access from unwilling landowners in South Dakota, while Summit has already filed dozens of eminent domain court cases in the state.

When asked by South Dakota Searchlight if Navigator will seek reconsideration of the commission’s decision, Navigator spokesperson Elizabeth Burns-Thompson replied by text message that the company “will determine that once we have the chance to review the final written order on Sept. 26.”

Rick Bonander, whose rural Valley Springs land would be crossed by the pipeline, told South Dakota Searchlight that he is “extremely happy.”

“I was about 50-50 on what I thought would happen today,” he said. “Wow. Just, wow.”

Project details

Navigator applied for its South Dakota permit in September 2022, outlining plans for a $3 billion, 1,300-mile pipeline to transport carbon dioxide in liquid form from 21 ethanol and fertilizer plants across five states to an underground sequestration site in Illinois.

Part of the project’s attraction is its eligibility for annual federal tax credits of $85 per metric ton of sequestered carbon. The federal government offers the credit as an incentive to remove heat-trapping carbon dioxide from the atmosphere and sequester it, as a means of combating climate change.

County ordinances upheld

Safety concerns figured into ordinances adopted in Minnehaha and Moody counties in South Dakota requiring minimum setback distances for pipelines. In June, Navigator filed a motion to preempt local county setback ordinances.

But the commissioners determined the ordinances are not unreasonably restrictive, given that a company representative acknowledged Navigator could still complete the project while obeying Moody County’s setbacks.

This article first appeared in the South Dakota Searchlight and the Iowa Capital Dispatch.