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$4 billion ND petrochemical plant to receive Continental produced ethane

A $4 billion petrochemical plant, plans for which were unveiled last fall, has entered into a supply agreement with one of North Dakota’s biggest oil players, reports the Forum News Service (FNS).

Denver-based Badlands NGL said in a news release that it has entered into a “precedent agreement” with Continental Resources to supply the proposed plant with ethane gas, a byproduct of natural gas which will be converted into polyethylene to be used in a variety of plastic products.

Badlands CEO William Gilliam said, “It’s a great vote of confidence for our project that a highly respected company like [Continental] will be a supplier. It means that to the extent that they’ve got some uncommitted ethane, they will work with us to see if we can get it to the plant we want to build.”

The duration of the agreement wasn’t disclosed. In June, however, Gilliam told the FNS that the company was close to closing a 10-year ethane supply agreement with one of the top three producers in North Dakota. Badlands won’t be able to begin collecting Continental produced ethane until the plant is completed, which is projected to be within three to five years.

Although the location for the plant has not been specified, Gilliam said that due to continued discussions with ethane feedstock suppliers in North Dakota and western Canada, the company will increase the size of the planned North Dakota facility from producing an annual 1.53 million metric tons to 2 million metric tons. He added that the company has entered into licensing agreements with key technology partners and other agreements have been finalized in the past few weeks. Continental had no comments in addition to what was stated in the news release.

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