COLUMBIA CITY, Ore. — A $1.1 billion renewable diesel plant proposed for Port Westward is one step closer to reality, but the project still faces a long regulatory road before it gets built.
The Port of St. Helens commissioners Wednesday approved a site development and option agreement for the project with NEXT Energy Group.
Commission President Chris Iverson said the resolution allows NEXT to start assessing the property near Clatskanie and begin design work. The port and commission will continue to research the project, he said.
The option agreement includes a monthly payment of $15,000 from NEXT Energy to the port starting on Oct. 1. The payment will continue through the design phase until NEXT decides whether to begin construction.
The port and NEXT will also have to negotiate a lease, but the port can’t lease the property until the state rezones the site.
The plant would take up about 80 acres at Port Westward Industrial Park north of Clatskanie. The port is trying to rezone about 837 acres of the 1,700-acre park, and the effort has proven controversial and suffered setbacks. The Oregon Land Use Board of Appeals has scheduled oral arguments on the rezone for Nov. 1.
The agreement states the plant would use feedstocks such as used cooking oil, animal fat and some plant oils to produce renewable fuels. The plant would be permitted to produce 50,000 barrels per day and initially produce 37,500.
Lou Soumas, CEO of Waterside Energy Development, which owns NEXT Energy, has told the port the company would hire locally for plant construction and operations. It would employ about 210 full-time employees with an average base salary of $77,851.
Dan Serres, conservation director for Columbia Riverkeeper, an environmental group, said the port should look into a failed venture that Waterside and Soumas were involved with in Odessa, Wash. The company shut down in 2014 and left behind chemical waste.
Waterside also previously looked to build an oil refinery at the Port of Longview in 2015. Port of Longview commissioners cut off talks with Waterside in February 2016 because the company failed to prove it had financial backing.
Port of St. Helens Executive Director Doug Hayes said the port is adamant that Soumas and NEXT Energy provide proof of financial backing. Soumas showed the port contracts with the project backers and Hayes spoke to three of the four investors, he said. NEXT and the port are declining to identify the investors until the project moves further along.
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Soumas said the company is already making a financial commitment to the project and will spend about $3 million to assess the property and $18 million on engineering designs.
The port is aware of public concerns about the company’s past, Hayes said. He said he spoke with the Port of Longview and Odessa, studied EPA records and looked at market research on renewable diesel. So far, the port’s research has confirmed what NEXT Energy and Soumas has presented, Hayes said.
Riverkeeper and Rainier resident Darrel Whipple both voiced concerns about the possibility of an export facility for LPG, or liquefied petroleum gas, built at the renewable diesel plant. LPG is a fossil fuel and Serres said he wouldn’t want to see the project change from a renewable to fossil fuel focus.
Commissioner Larry Ericksen said LPG is a byproduct of the renewable diesel creation process, and creating an export terminal is not part of the plan.
Soumas said even if NEXT Energy wanted to move LPG by train, it would have to get a permit. He said that wouldn’t be something that would happen without public knowledge. (Riverkeeper representatives noted that Global Partners started exporting oil from a former ethanol plant at Port Westward with next to no public notice or involvement.)
Serres said he was glad to hear the port acknowledge the concern of a possible “bait and switch” at the proposed plant. Riverkeeper is not as confident the permit process will pick up on any change in operations the company may make, he said.
“It will be up to the port to do research and understand what the facility will do and could do in the future and make a decision that invites the public to weigh in,” Serres said.
Riverkeeper, Whipple and commissioners also raised concerns about rail use. Soumas said the plant would use boats to transport products, not the existing rail line. Commissioner Robert Keyser said he wants guarantees that the plant will produce and operate as NEXT is asserting.
The company has not yet identified the exact site for the project, Soumas said. It will be more clear what type of utilities, roads and rail lines the plant would need once the site is chosen, he said.
Soumas said the project should move forward quickly and be operational in 2021. The company hopes to start construction in late summer 2019.