By Jim Johnson
SENIOR STAFF REPORTER
Published: October 14, 2014 2:05 pm ET
Updated: October 14, 2014 3:22 pm ET

Image By: North Dakota Gov. Jack Dalrymple's office
North Dakota Gov. Jack Dalrymple, left, and Badlands CEO William Jeffrey Gilliam.

North Dakota’s largest-ever private investment — $4 billion — is being aimed squarely at the plastics industry, polyethylene in particular.

Badlands NGL LLC is planning a PE manufacturing plant that will use the ethane byproduct of oil production as a feedstock. The specific location has not been named.

It’s the kind of project, expected to create 500 jobs, that has the governor standing next to developers to help announce the deal.

North Dakota, maybe like nowhere else in the country, is being transformed by the shale oil and gas boom.

Wal-Mart Stores Inc. workers start out making $17 an hour in one North Dakota town, state coffers are flowing over with oil tax revenue, and now Badlands is plunking down $4 billion to make PE.

“This project is fully aligned with our goals to reduce flaring, add value to our energy resources right here in North Dakota and create diverse job opportunities across the state,” Gov. Jack Dalrymple said in a statement.

Badlands expects annual output of low density PE and high density PE will be 3.3 billion pounds.

Most of the PE will be marketed in the United States, but the company also expects exports to Asia, South America and Europe, shipping from both Pacific Northwest and East Coast ports.

North Dakota has risen in recent years to become the second largest oil producing state, now only behind Texas.

“We are committed to maximizing the value of Bakken ethane for producers, their midstream partners and all gas processors,” said Badlands CEO William Jeffrey Gilliam in a statement. “This facility is the solution needed to add value to North Dakota’s ethane supply and make it a commercially marketable product.”

Badlands is working with Tecnicas Reunidas of Madrid, Spain, an engineering and construction company serving the oil and gas, refining, petrochemical and energy generation fields.

The company also is working with Vinmar Projects of Houston, a global marketing, distribution and project development company for producers and users of petrochemical products. Vinmar and Badlands have a 15-year memorandum of understanding for 100 percent of the PE to be produced.

Tecnicas Reunidas currently is working on a preliminary engineering analysis for the project, work that’s expected to be completed this year and will include final site selection.