Voters advance measure to build South Dakota refineryELK POINT, S.D. — Voters in this mostly agricultural corner of the Midwest have approved a proposal to build the first new U.S. oil refinery in more than 30 years.
By: By DIRK LAMMERS /The Associated Press, The Daily Telegram
ELK POINT, S.D. — Voters in this mostly agricultural corner of the Midwest have approved a proposal to build the first new U.S. oil refinery in more than 30 years.
Union County residents voted 58 percent to 42 percent this week to endorse the rezoning of almost 3,300 acres of pristine farm land north of Elk Point for the oil refinery.
Texas-based Hyperion Resources sought rezoning for the $10 billion refinery, billed as a potential step toward national energy independence.
Like an expanded Murphy Oil refinery in Superior, the Hyperion facility would draw upon thick western Canada crude for its supply. But there’s enough of it to supply more than one refinery, said Dave Podratz, manager of the Superior refinery.
“That expansion, at 400,000 barrels per day, still leaves plenty of oil out there,” he said, and there’s ample demand for gasoline in the Midwest.
Murphy is in the early stages of evaluating plans to increase production capacity to about 235,000 barrels per day through an expansion valued at $6 billion. If plans advance, the corporation would face numerous regulatory hurdles and opposition by some environmentalists.
Already, the Hyperion proposal has been a contentious issue in the southeast corner of South Dakota, with supporters citing economic development benefits and opponents voicing environmental and quality-of-life concerns.
The ballot measure garnered solid support in the southern part of Union County. Most rural precincts strongly rejected the rezoning, but they didn’t have the population to overcome support in the county’s largest towns.
Preston Phillips, a Hyperion Resources project executive, said he was ecstatic with the outcome.
“We’ll continue to work with everyone in the county,” he said. “We want to be a good corporate citizen. We want to be a good corporate neighbor.”
Despite the approval of the rezoning, Phillips said Elk Point is not the only site being considered and that the site selection process would continue. “Any big project like this has to have options,” he said.
Hyperion’s next big hurdle is a lengthy air quality permit application being reviewed by the South Dakota Department of Environment and Natural Resources.
“It’s going to be a long road before anything’s done on it,” project opponent Jason Quam said of the refinery.
Besides the permits, he said he doubted Hyperion could secure financing for the refinery.
Quam, of the group Citizens Against Oil Pollution, said his organization was evaluating its next move.
Elk Point Mayor Isabel Trobaugh said the refinery would bring needed jobs to the county and that she didn’t think it would harm the environment. She said she talked to the mayors of Ponca City, Okla., and El Dorado, Kan. — which both have oil refineries — and they assured her their communities had clean air and water.
Hyperion has said the project, about 60 miles south of Sioux Falls, would create 1,800 permanent jobs and another 4,500 construction jobs over a four-year period. Construction could begin in 2010.
The Hyperion Energy Center would process 400,000 barrels of thick Canadian crude oil a day, which company executives say would help the U.S. reduce its dependence on overseas oil. The company has said it will bring in the crude oil by pipeline but has announced no specific plans for that transportation link.
Hyperion billed the facility as a “green refinery” and said it would produce ultra-low sulfur gasoline and diesel and rank among the cleanest and most environmentally friendly oil refineries in the world.
The Daily Telegram contributed to this article.