Progress on pipeline project through Iowa not affected by drop in oil prices

DES MOINES - The dramatic drop in oil prices has not affected a Texas energy company's plans to build a 1,100-mile pipeline through Iowa to connect the Bakken oil fields in North Dakota with a regional shipping hub in Illinois, a company spokesman says.

Vicki Granado, a spokeswoman for Dallas-based Energy Transfer Partners LP, said plans are moving forward to seek Iowa regulatory approval for a project that would involve placing 343 miles of 30-inch-diameter transmission pipeline on a diagonal line crossing 18 counties with completion slated for late 2016.

'We're on track,” said Granado, who expected ETP officials would file required documentation for the pipeline's proposed route and public necessity around Jan. 16 seeking Iowa Utilities Board approval for a permit to start the project early next year. 'It's a long process to work through. We're underway in the process and we hope we get to a positive end.”

Concerns were raised during public information meetings held in December about the potential for spills, environmental damage or other problems associated with an underground pipeline that eventually could move up to 570,000 barrels of crude oil daily through Iowa. But Granado said the company viewed the dialogue around the project as positive.

ETP officials have received approval from about 80 percent of the 1,751 property owners along the proposed Iowa leg to survey their land for the proposed pipeline that, according to company documents, would be buried so the top of the pipe is at least 48 inches deep or so the top of the pipe is two feet below any drain tiles, whichever is lower. The permanent easement will be 50 feet wide, but the temporary construction corridor will be 100 to 150 feet wide.

Granado said the company is conducting surveys and is beginning to negotiate easement agreements based on fair market value appraisals of property for each county. A financial analysis prepared by West Des Moines-based Strategic Economics Group projected that during the construction stage of the project, Iowa land owners would receive about $60 million in 'easement and damages” payments for the restoration and use of their right of way.

'We are in the infancy stages of talking about easements because we weren't allowed to conduct those types of conversations until after we held the public meetings in December,” she said. 'That part of the process is really just getting started.”

Iowa law allows for petitioners to seek eminent domain authority - government authority to take private property for public use in exchange for payment of fair market value - to acquire easements on properties where owners fail to reach a voluntary agreement with the company. Granado said generally those would be considered on a request basis with the Iowa Utilities Board if company officials felt like they needed to exercise that as an option of last resort.

'We have said and we continue to say that we would much rather come to a voluntary agreement and we're going to do everything possible for that to happen because we just feel like it's the better way to do business,” she said.

'We hope that we're going to be able to do that as much as possible,” she added. 'Do we think we're going to reach 100 percent? Probably not, but we'd like to get as close to that as possible.”

House and Senate leaders from both political parties who participated in a legislative forum Wednesday sponsored by the Associated Press said they expected bills would be introduced in both chambers during the 2015 session related to the exercise of eminent domain authority in Iowa, but it was unclear whether any proposals would make it to Gov. Terry Branstad's desk.

Branstad called eminent domain a 'very difficult and controversial subject,” and he preferred to abide by the processes currently in place that grant limited regulatory authority.

'I do respect the fact the people feel very strongly about their property rights and they need to be treated fairly,” the governor said. But he also acknowledged that for public policy reasons one person should not be able to block an important project that is going to serve the overall public good.

'That's why it's a delicate balance,” he said.

'I don't think we should have political interference with that,” the governor said. 'I think it would be a mistake to get politics into this.”