Two companies are teaming up to study building a 17-hundred mile pipeline exclusively to carry Iowa ethanol to the nation’s East Coast. It’s a three-billion dollar proposal and Iowa Senator Chuck Grassley says he’s all for it: "A designated pipeline is probably the best thing and it’s good news for the ethanol industry and it’s good news for the Midwest."

Oklahoma-based Magellan and Buckeye Partners of Pennsylvania say the pipeline would originate in northwest Iowa with several collection points in the Hawkeye State — and it would end in New York harbor to deliver up to ten-million gallons of ethanol a day.

Grassley says: "Those people are major league players. They have a 80 or 90-year history of running pipelines and probably have a staff that has already done what we in Congress didn’t know was feasible or not and were thinking about appropriating money for." Grassley says Congress was considering putting millions of dollars into studying whether the federal government could build such a pipeline, but now, may let free enterprise lead the way.

He says the pipeline could actually -cut- ethanol prices in the long run, saying, "If we could have such a pipeline, it would probably be a greater boost to the production of ethanol than either the tax incentive or the mandate that we have in existing law."

Grassley says, "Transporting ethanol by pipeline is a 16-cent per gallon savings over doing it by rail and that 16-cent savings is more valuable than the tax incentive that we have, or the mandate that we have." The federal government is requiring refiners to be using 36-billion gallons of ethanol and other biofuels by 2022. The proposed pipeline could take several years to build. The companies’ joint feasibility study is expected to be complete later this year