BISMARCK, N.D. -- A North Dakota judge has ruled that regulators properly refrained from getting involved in a dispute over the location of an $800 million oil refinery planned near Theodore Roosevelt National Park, sparing developers from a potentially lengthy delay in construction.
The Public Service Commission last year declined to review whether the planned Davis Refinery could be built just 3 miles (5 kilometers) from the park in the western North Dakota Badlands, concluding the refinery will be too small to warrant review under state law.
Environmental groups that don't believe developer Meridian Energy Group is being forthright about the refinery's size asked a state judge to order the commission to hold a hearing — a request that Meridian called "a fishing expedition."
Judge Bruce Romanick on Tuesday sided with the PSC, ruling the agency followed state law that requires only those oil refineries with a capacity of 50,000 or more barrels daily to obtain a site permit from the agency. Meridian's current capacity estimate for the Davis Refinery is 49,500 barrels daily.
"Because the PSC was without jurisdiction, it could not conduct a hearing," Romanick ruled.
He also said regulators did not abuse their discretion in denying a chance for the plaintiffs to receive more information from Meridian about the refinery plans so they could try to prove their contention that the company is trying to skirt state law. Meridian disputes that.
Opponents said they plan to appeal to the state Supreme Court.
A PSC review can take half a year or longer to complete. Meridian said it was pleased with Romanick's ruling.
"Trying to push Meridian into a PSC siting process for the Davis project is a transparent attempt to slow down the project," the company said.
The national park is North Dakota's top tourist attraction, drawing more than 700,000 visitors annually. The company says the facility will be the "cleanest refinery on the planet," a model for future plants and a boost for the area economy. Environmental groups worry pollution will erode air quality at the park and mar its majestic scenery.
Meridian initially said the refinery would have a capacity of 55,000 barrels, but as the project evolved, the company lowered the figure to 49,500 barrels daily. CEO William Prentice signed an affidavit saying Meridian has "no current plans" for any expansion beyond that.
The Environmental Law and Policy Center and the Dakota Resource Council question the company's veracity, and they criticized the PSC for trusting the company. The PSC didn't comment on Romanick's decision, saying the ruling speaks for itself.
Dakota Resource Council attorney JJ England said the group will appeal to the state Supreme Court, noting Romanick didn't address the fact that Meridian's state air quality permit is for a facility with a 55,000-barrel capacity.
"This decision also raises alarming questions about the jurisdiction of North Dakota state agencies," he said.
Meridian began site work for the refinery last summer and has a goal of having it fully operating by mid-2021 , though the company still faces another court battle. The National Parks Conservation Association has appealed to the state Supreme Court the air quality permit that the state Health Department issued for the refinery, arguing it violates the federal Clean Air Act.
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