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East county oil refinery will move

Yuma Sun
BY SARAH REYNOLDS
February 5, 2008

The planned oil refinery in eastern Yuma County is on the move to avoid being held up by an ongoing lawsuit.

The refinery, a project by Arizona Clean Fuels Yuma, will be built on an alternate site about two miles east of the original. It is approximately 45 miles east of the city of Yuma near Mohawk Valley, extends from about Avenue 48E to just past Avenue 49E from east to west, and is bounded by County 6th Street and the railroad tracks from north to south.

It had been slotted as an alternate site by Arizona Clean Fuels during its study of the area. Executives announced the move last Thursday.

Part of this site is privately deeded land, and another portion comes from buying up an existing lease on state land, according Arizona Clean Fuels CEO Glenn McGinnis.

This move was prompted by a litigation battle the Quechan Tribe is pursuing over 39,000 acres of land in eastern Yuma County. The refinery site is on a portion of that land.

The lawsuit is ongoing but could take months, or years, to reach a resolution. McGinnis said they did not want the "legal uncertainty" to stall the project.

He added that the lawsuit has already delayed the refinery by about nine months from the original timeline.

Arizona Clean Fuels will have to apply for county permits again for the new land site and get its environmental permit reissued from the Arizona Department of Environmental Quality.

McGinnis said he has already spoken with ADEQ officials and expects to have the permit reissued by the middle of this year. He spoke to the Yuma County Board of Supervisors Monday morning to update them on the move.

"We're running a lot of things in parallel to minimize the impact," McGinnis said.

He said they expect to start construction on the refinery by 2009 and have a tentative completion date of 2012.

Board of Supervisors Chairman Greg Ferguson said he wished the project success despite the hurdles Arizona Clean Fuels had faced.

"I wish them the best of luck. It seems like they have one obstacle after another," Ferguson said.

He said he was not sure how long it would take the company to obtain new permits through the county. He said a minor zoning amendment could be done within a month or two, but major changes could drag out until the end of the year.

"If they get the new parcel, they'll have to check the zoning and they did say in their presentation they were going to require an amendment," Ferguson said. "Even though it is just three miles away, it's a totally different piece of land."

The refinery project would produce 150,000 barrels of gasoline, diesel and jet fuels per day, according to Arizona Clean Fuels. The overall project is projected to cost $3.7 billion. After startup, the company projects it will need 600-650 employees and contractors to staff it.

McGinnis said this refinery is particularly important because existing West Coast refineries have reached capacity and probably will not be expanded. This refinery, he said, would be key to meeting the West's increased demand for fuel without reliance on foreign imports.

He said the company would seek to minimize the impact on the environment. "This will be the cleanest refinery ever built."

The lawsuit that are causing the move has been in the federal courts for almost a year.

In March 2007, the Quechan Tribe sued to stop the transfer of 39,000 acres of land from the U.S. Department of the Interior's Bureau of Reclamation to the Wellton-Mohawk Irrigation and Drainage District.

Neither the new site nor the old one are on the Quechan reservation. However, according to previous reports in The Sun, the Quechans alleged the Bureau of Reclamation violated the Wellton-Mohawk Transfer Act by transferring land for the development of an oil refinery.

They charged that the defendants failed to properly address the impact of future uses of the land such as the refinery and violated the National Environmental Policy Act and National Historic Preservation Act.

Calls from The Sun to Quechan tribal officials for comment Monday were not returned.

A federal judge in the U.S. District Court in Arizona denied the tribe's lawsuit in June, but the Quechans have appealed to the U.S. Court of Appeals for the Ninth Circuit in San Francisco.

Sarah Reynolds can be reached at sreynolds@yumasun.com or 539-6847.

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