Kinder mulls sending ethanol on Plantation line
ORLANDO, Florida, April 22 (Reuters) - U.S. oil products pipeline company Kinder Morgan Energy Partners (KMP.N) is exploring sending ethanol on the Louisiana to Virginia Plantation duct as business for the alternative motor fuel expands.
"We are evaluating the Plantation pipeline ... as the next possible pipeline system that can handle ethanol," Jim Lelio, a renewable fuels business development director at the company, told the Alternative Fuels & Vehicles conference in Orlando on Tuesday.
Late last year, Kinder said it had started sending batches of the biofuel through a 105-mile (170-km) petroleum products pipeline in Florida on demand from customers seeking to cut the costs of transportation of the fuel via rail and trucks.
Lelio said there were a number of challenges in sending ethanol on product lines and the challenges are bigger for a much bigger line like Plantation. Petroleum products can travel about 10 times as far on Plantation than on the Florida duct.
A prime concern about sending oil through pipelines is that the fuel can absorb excess oxygen causing a problem called stress corrosion cracking.
But Raymond Paul, the government affairs director at the Washington, D.C.-based Association of Oil Pipelines, has said companies have found ways to control that problem as well as water absorption.
Other companies are also interested in transporting ethanol by pipe. Magellan Midstream Partners (MMP.N) and Poet, the largest U.S. ethanol producer, said in March they signed an agreement to study building a $3.5 billion dedicated pipeline to carry ethanol from the U.S. Midwest production center to the U.S. Northeast.
Lelio said the process of evaluating Plantation was a much bigger job than the small Florida line which took about 18 months and more than $10 million to evaluate.
He said Kinder would start this year the engineering evaluation on Plantation "and potentially the cleaning process, which is a major factor in putting ethanol in the pipeline." (Reporting by Timothy Gardner, editing by Marguerita Choy)
