Agency OKs refinery near Yuma - East Valley Tribune: Business

Agency OKs refinery near Yuma

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Posted: Monday, September 13, 2004 9:07 pm | Updated: 5:21 pm, Thu Oct 6, 2011.

The state Department of Environmental Quality gave preliminary approval Monday for what would be the state’s first gasoline refinery.

DEQ director Steve Owens said the $2.5 billion plant to be built near Tacna, about 40 miles east of Yuma, will have to be constructed to state-of-the-art emission standards. He said his agency authorized the permit for Arizona Clean Fuels after ensuring that it would be the cleanest refinery in the country.

But Owens acknowledged that “a refinery is still a refinery” and it will emit various volatile compounds such as benzene and sulfur dioxide. He said, though, that its location is far enough away from most development so that it will not be a nuisance.

Owens also said the permit prohibits the burning off of excess gases, a staple at many refineries that not only creates smells but also leads to visual blight.

Stan Barnes, publicist for Arizona Clean Fuels, said the company is “optimistic” that Monday’s action will pave the way to start construction late next year or early in 2006. But Barnes said he did not know whether his client will seek to have the permit restrictions loosened during public hearings later this year.

The preliminary permit limits the plant to only about 1,100 tons of pollutants annually. By contrast, Arizona Clean Fuels had requested permission to emit more than 5,000 tons a year, including more than 2,000 tons of volatile organic chemicals alone — 10 times more than the permit will allow.

If the refinery is built, it will be the first new facility constructed in the United States in 30 years. It also will be the only refinery between Texas and California.

Owens said DEQ’s decision to grant a permit was unaffected by the gasoline shortage that hit Arizona last summer as well as the more recent high fuel prices. Arizona’s lack of its own fuel supply has been cited as a factor in both.

“The only issues we considered were the air quality issues,” he said.

Slightly more than half of the 150,000 barrels of fuel that would be produced daily would be gasoline for cars and trucks. The balance would be diesel and jet fuel.

According to the company, that is about half of what is used daily in Arizona.

Arizona Clean Fuels originally had wanted to build its plant near Mobile, southwest of Phoenix. But those plans were scrapped because of upcoming changes in Maricopa County air quality regulations, which would have made expansion at that site difficult.

Yuma County has no similar restrictions.

The DEQ permit is only part of what has to occur if the plant is to be operating by its scheduled 2009 completion date. Yuma County supervisors still have to approve the necessary industrial zoning. More pressing, plant owners will not begin construction without a guaranteed supply of crude oil.

Barnes said the company is negotiating with Pemex, the oil company owned by the Mexican government, to provide the oil through a pipeline that would be built across northern Mexico.

Barnes said there already is a nearby pipeline that can transport refined natural gas to the Valley.

Owens said while DEQ is satisfied with what is in the draft permit, it may not be the last word. He said agency employees will be paying attention during public hearings next month in Wellton, Yuma and Phoenix.

“You never know what might be raised during the hearing process,” he said. Owens said someone might suggest an alternate way of dealing with pollutants or bring up some issue not considered.

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