The North Dakota Industrial Commission on Tuesday, Aug. 25, approved $205 million in loans for Project Tundra, a carbon capture retrofit at Minnkota Power Cooperative's Milton R. Young Station near Center in Oliver County.

The Industrial Commission split the loan package between Minnkota and project partner Reliant Carbon Capture & Storage: $45 million to the Grand Forks-based cooperative and $160 million to Reliant. The state-owned Bank of North Dakota will issue the debt.

What does the retrofit actually do?

Project Tundra targets about 5 million tons of CO2 per year at the lignite-fired Young Station. At the current federal Section 45Q tax credit of $85 per ton, that volume translates into roughly $425 million in annual credits.

Reliant deploys a cooling-based process that converts captured CO2 from gas to a denser, transport-ready phase. Minnkota has already secured underground-storage permits at the plant site.

Where does the CO2 go — storage or EOR?

The revised project leans harder than the 2015 original on enhanced oil recovery in North Dakota's oil fields. The loan application references partnership discussions with operators that would inject the CO2 into producing wells to lift output.

Federal policy had previously paid less for CO2 used in EOR than for permanent sequestration; that gap closed at $85 per ton across both pathways. The alignment improved the project's commercial case by giving oil-field hosts the same per-ton incentive as saline-storage developers.

Kelvin Hullet, chief public affairs officer at the Bank of North Dakota, said Reliant brings prior coal-plant operating experience. "The science has gotten better, the technology has gotten better," Gov. Kelly Armstrong, who chairs the three-member Industrial Commission, said of the redesigned project.

How did the price tag move?

The capital estimate has come down sharply. Hullet told the commission the figure has fallen from about $3 billion on the original concept to roughly $1.7 billion today. Reliant's entry into the partnership, replacing an earlier developer, accounts for some of the redesign.

In a presentation last week to the Clean Sustainable Energy Authority — the body that recommended approval — company officials said the retrofit would cut plant emissions by 95%, create about 350 jobs and leave customer rates unchanged.

What is the state's exposure?

The Clean Sustainable Energy Authority set aside $250 million for Project Tundra last year without recommending drawdown. Tuesday's vote releases $205 million of that envelope at 2% interest, with the offer expiring after one year.

The requested payback runs 12 years, though specifics remain subject to negotiation with the Bank of North Dakota.

"I think the risk to the state for loss on these is extremely low," State Sen. Dale Patten, R-Watford City, co-chair of the Clean Sustainable Energy Authority and a retired banker, said at the meeting. Patten pointed to the asset base controlled by Minnkota and Reliant and the projected project revenue.

State officials have said CO2 injection could extend the producing life of North Dakota wells and lift oil and gas severance collections.

When does the final call come?

Minnkota said in announcing the Reliant partnership that it will decide whether to proceed with Project Tundra in 2027. The 2% loan offer expires after a year, fixing a financing window that closes in line with that final investment decision.

Any pipeline needed to move CO2 from the Young Station to an oil-field host would be funded separately, per the loan application letter. Watch the gathering-line routing, the host operator and the offtake volume — those details will signal whether Project Tundra has cleared FID.