It’s the first of its kind for North Dakota.
North Dakota LNG is building a liquefied natural gas processing plant in Tioga. The company says the first phase will be on-line this summer, producing 10,000 gallons per day of LNG. Then, in 2015, another 66,000 gallons per day will be added.
Company CEO Pat Hughes says initially, the LNG will be used specifically by the oil industry.
"One is to supplement the use of diesel fuel on drill rigs," said Hughes. "The second is to use LNG in the fracking process."
Hughes says a third objective is to find uses outside of the oil and gas industry.
"We're working with companies like Montana-Dakota Utilities to identify industrial users that don't traditionally have access to natural gas products," said Hughes. "We want to identify those opportunities and bring solutions."
Gov. Jack Dalrymple says the announcement fits into a strategy that he calls “value added energy.” Dalrymple says it’s akin to what the state has being doing with “value added agriculture.”
"We think that these incredible supplies of natural gas liquids, as well as crude oil, give us a great opportunity to add value to petroleum," said Dalrymple. He also says he hopes the use of LNG and compressed natural gas will expand statewide.
"And that means we can begin to supply fuel to grain elevators, to dry grain," said Dalrymple. "We can eventually supply fuel to small cities, and even all the way to home heating fuel. These can compete with other sources."
Dalrymple says it will also eventually help reduce the flaring of natural gas.
The company did not disclose the project cost.
