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Journal exclusive: Hyperion wants amended permit, delayed start
News Articles | Souix City Journal | Dave Dreeszen | June 12, 2010
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PIERRE, S.D. — Hyperion Refining is seeking to amend a state air quality permit approved last summer for its proposed oil refinery in southeast South Dakota, and push back the required start date for the $10 billion project.
In court documents filed last week, Hyperion asked for permission to present additional evidence to the state Board of Minerals and Environment. The Dallas, Texas-based company said it needs to address some new federal environmental rules and regulations adopted after the state board granted the permit on Aug. 20.
At a hearing Tuesday in Pierre, Hughes County Circuit Court Judge Mark Barnett is scheduled to consider the company’s request to reopen the permitting process. If the request is granted, an appeal of the Board of Minerals and Environment’s decision would be put on hold.
A hearing on the appeal had been scheduled for June 23 in Pierre. Opponents, which include the South Dakota Sierra Club and two local grassroots groups, argue the air permit should be thrown out because the company and state failed to prove the oil refinery and power plant would meet legal requirements.
Hyperion also filed its own, more limited appeal, asking that board’s decision on a carbon monoxide limit be overturned.
The refinery and adjacent power plant, which would process 400,000 barrels of Canadian tar sands crude per day into low-sulfur gas, diesel and jet fuel, would be built in rural Union County, just north of Elk Point.
The original plans called for ground to be broken on the mammoth project this year, but the economic downturn and a longer-than-expected permitting process delayed those plans.
Hyperion officials have been saying for some time that it now plans to turn the first spades of dirt in the latter half of 2011. That revised timetable would have been in violation of a condition of the current air permit, which requires Hyperion to start construction within 18 months of the state board’s approval, or February 2011.
In its latest legal filing, Hyperion requested an 18-month extension of the required start date. That would allow work to begin as late as August 2012. Butut Hyperion project executive Preston Phillips said the company continues to expect the project to commence by the end of next year.
“Our time line on construction hasn’t changed, and we’re still plowing ahead with that target,” Phillips said in a conference call Friday.
An extension, Hyperion said, also would allow the company to update its best available control technologies to control pollution, and ensure its permit is in compliance with new Environmental Protection Agency standards for the emissions of sulfur dioxide and nitrogen oxide. In addition, the EPA also recently ruled it considers “coker quench water tanks” as a source of emissions at oil refineries.
The tanks are an integral part of the design of Hyperion’s power plant, which would turn petroleum coke, a refinery by-product, into electricity and hydrogen to run the refinery. Hyperion contends the gasification process is a unique, cutting-edge technology that would significantly reduce emissions.
A Hyperion opponent said Friday the company’s request to amend its air permit is “consistent with the things we have been contending all along.”
“The permit was not complete and accurate, and they’re acknowledging there is one source of emissions that was not previously disclosed,” said Ed Cable, a spokesman for the grassroots group, Save Union County.
Opponents argue the refinery would release thousands of tons of dangerous pollutants into the atmosphere each year, endangering the health residents in the region.
In its legal briefs, attorneys for the opposition groups argue that the company and state Department of Environment and Natural Resources opponents failed to provide clear and convincing evidence that the energy center would comply with federal air quality standards or use the best available pollution control technologies.
By asking to amend its application, Hyperion has opened the door for the court to thrown out the entire permit, the opponents argue.
“If the court isn’t willing to do that, they should open it up to the all items in dispute,” Cable said.
Hyperion wants the board to consider only the new evidence in its most recent legal filing. In addition, the company has asked that the board review and make a decision on its request by Dec. 17, 2010.
Phillips said the proposed deadline would allow the company to stay on its current timetable.
Tagged with: south dakota, air permit, canadian oil sands, hyperion refinery
