Final government approval anticipated for tribally owned oil refinery
The Mandan, Hidatsa, Arikara (MHA) Nation proposes to construct a 15,000-barrel-per-day petroleum refinery on the Fort Berthold Indian Reservation near the town of Makoti, N.D.
Horace Pipe, a consultant for the Three Affiliated Tribes and project manager for the refinery, said the tribe should have final federal approval in the next few weeks.
“I think it is pretty likely that this will be built,” Pipe said. “We have done everything and we are ready. We are very close. We are on the 99 yard line and hope to have the final answer in the coming weeks.”
The refinery was first proposed in the 1990s. The tribe applied to the Environmental Protection Agency for approval in 2003.
The EPA, the Department of the Interior and the Bureau of Indian Affairs have completed the Final Environmental Impact Statement (FEIS) for the refinery. Initially, the FEIS was made available for public review for a 30-day “wait period” from Aug. 28 through Sep. 28, 2009. On Sept. 18, the agencies extended the wait period another 30 days to Oct. 28. There was an additional extension permitted following this time frame. After the wait period, the federal agencies can make their decisions on the proposed federal actions.
“The first step once we get the permit would be to put up a fence and get the survey work completed,” Pipe said. “After that we could start moving dirt.” Pipe estimates the project will employ 1,800 people during the construction phase, which will take approximately 24 months to complete.”
Pipe explains that the development of an oil refinery on the Fort Berthold Indian Reservation would offer good-paying jobs. Fort Berthold Community College has already started a two year energy training program for potential refinery workers.
“The impact on North Dakota and the business community would be tremendous,” Pipe said. “There will be approximately 65 permanent jobs, with additional jobs created in the local service industry.”
The proposed refinery is being billed as a clean fuels project because it will use synthetic oil that’s already been partly refined in Canada. The refinery would process this oil into gasoline, diesel, jet fuel and propane. The refinery would also have the ability to be adapted to refine Bakken crude oil.
“Back when it was proposed (in 2003) there really wasn’t a lot of oil activity in North Dakota,” Pipe said. “Now with the Williston basin coming online, it could be a good plus for the refinery.”
The Bakken formation in the Williston basin is considered to be one of the best oil plays in the U.S. It stretches across North Dakota, Montana, South Dakota, Manitoba and Saskatchewan. In total, the basin covers roughly 300,000 square miles.
Pipe explains that the facility would be the country’s first new oil refinery in more than 30 years. He estimates that the construction cost will total $400 million.
“Building this new green field refinery would be a very historic event,” said Lynn Helms, director of the state’s Department of Mineral Resources. “There is a pretty tight window of opportunity to get it built and operating after the record of decision and before climate change legislation and/or regulations from EPA change the rules.”
“The products (from the refinery) would generate competition in the Minot region, which should lower gasoline and diesel prices,” says Helms. “For example, Fargo has three or four sources of product that compete and gasoline prices there are typically 10-15 cents per gallon lower than the rest of the state.”
Helms said the refinery will be smaller than other refineries in the area. “The (estimate) is 15,000 barrels per day,” Helms said. “That is one-fourth the size of the Mandan refinery, the Cenex, Conoco, and Exxon refineries in Billings, one-fifth the size of Marathon’s St. Paul refinery, and about one-thirtieth the size of the Flint Hills refinery in Minnesota.”
The refinery would be on 190 acres of the 468.30- acre site previously purchased by the MHA Nation. The maining 279 acres would be used to grow forage for the tribe’s buffalo herd, although buffalo would not be located at the site. The proposed refinery location is in the northeast corner of the Fort Berthold Indian Reservation in Ward County. Once completed, the refinery would be owned and operated by the MHA Nation.
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