Poet puts dedicated ethanol pipeline project on hold

By Poet LLC | January 20, 2012

Citing slim prospects for a federal loan guarantee, Poet LLC has decided to put a dedicated ethanol pipeline on hold in order to focus on other priorities. In March, 2009, Poet joined Magellan Midstream Partners to study the feasibility of a dedicated ethanol pipeline. Magellan announced that they placed their interest in the project on hold early last year.

“We continue to believe that the pipeline is a viable project with tremendous benefits for the country,” said Poet founder and CEO Jeff Broin, “But with little prospects for a federal loan guarantee in the near future we are currently focused on other efforts.”

During the period when Poet and Magellan were working together, they had conducted preliminary studies of a dedicated ethanol pipeline, but from the beginning they believed that financing for a project of this size would be challenging without a federal loan guarantee.

Broin also said that the existing infrastructure for transporting ethanol serves the industry well.

“While a pipeline could improve the efficiency of ethanol distribution and lower costs for motorists, the system that we have in place today has allowed ethanol to flow seamlessly into more than 90 percent of the gasoline sold.”