North Dakota Gov. Jack Dalrymple and Badlands NGL’s LLC’s chairman CEO, William Jeffrey Gilliam, announced that a new polyethylene (PE) manufacturing facility will be built in North Dakota. The estimated $4 billion project cost will make the facility the largest private sector investment made in state history.

The value-added manufacturing facility will use North Dakota’s plentiful NGL-sourced ethane gas, which is a byproduct of oil production, from the Williston Basin. The project will reduce the amount of natural gas flared into the atmosphere, which has been a major focus for state and industry leaders.

The facility will convert ethane to polyethylene, which is then used to make a variety of consumer and industrial products. The facility has an expected production capacity of 1.5 million metric tons of polyethylene, or 3.3 billion pounds annually. It will employ more than 500 people and will take at least three years for full development. Badlands is working with Madrid, Spain-based Tecnicas Reunidas and Houston-based Vinmar Projects to complete the project. Initial evaluations and final site selection are scheduled for completion in 2014.