Industrial siting council to meet in Saratoga

Medicine Bow Fuel & Power LLC (MBFP), a subsidiary of DKRW, is asking for up to a three-year delay in submitting its construction schedule to the Industrial Siting Division.

A hearing will take place at 1 p.m., Dec. 18 at the Great Hall of the Platte Valley Community Center.

For more than eight years, Medicine Bow Fuel & Power LLC (MBFP) has been planning a coal-to-gasoline plant near Elk Mountain.

Robert Kelly, Executive Chairman of MBFP, in his letter to the Industrial Siting Council dated Sept. 20, 2013, is requesting the delay because "the ramp-up date was being delayed through items outside our control."

Kelly said Monday he wants to insure that the county and state are getting the most accurate information in the construction schedule. Kelly said with the data he has now, he cannot give accurate information on the construction schedule when the company is still negotiating with outside sources.

Kelly said currently there are two major activities going on now, negotiations with Engineering, Procurement and Construction Engineers and lining up the financing.

"It takes a lot of time to get the agreements in place for a project this size," Kelly said.

Kimber Wichmann, with the DEQ Industrial Siting Division, said there is a process in place for permit amendment requests, and amendments to permits are not unusual.

The request asks to put a hold on the requirement of a construction schedule for the permit. In addition, MBFP requests not to provide an update for the construction schedule for up to 30 months.

"We are not asking to suspend the filing of constructions reports. Our proposed amendments would suspend the filing the updated construction schedule and socioeconomic report until more information is known and we can provide current updated information," Kelly said.

Kelly said he hopes that the Industrial Siting Council agrees that the proposed amendment is the best solution for locals and the state of Wyoming. Kelly said the proposed amendment is "not just good for us, but for the communities. They will get the best up-to-date information."

Carbon County Commissioner Sue Jones said she attended the Industrial Siting Council meeting in Wheatland Oct. 1.

"I think they should have to apply for a new permit," she said.

Jones, who has followed the MBFP project since it was introduced in 2008, said several issues need to be revisited. Jones believes the severe drought Carbon County has endured may have an affect on the Mesaverda aquifer that would supply water for the plant.

"When something has been discussed and approved (by the Industrial Siting Council) you can't go back," Jones sad.

Jones said some of her constituents in Carbon County believe that MBFP has broken some of the rules of the permit.

"The Industrial Siting Council has never had anyone do this to them," Jones said, referring to the request to put the construction schedule on hold.

"To start over would be beneficial to all parties," Jones said. "A majority of the data is good, but some of it is dated."

Jones said with most of the work done for the current permit, it would be cleaner if MBFP started over.

The request would put the approved construction schedule on hold until six months before construction is slated to begin. Then MBFP would submit an updated construction schedule and the manpower numbers for each quarter. It would also include an updated socioeconomic analysis for the construction schedule and project schedule. An updated project description would be sent to the governing bodies with regulatory jurisdiction over the project and an updated housing plan.

MBFP in return would be allowed to continue monitoring and maintenance of existing facilities, such as the water wells and minor construction activity which would have minimal impact.

If MBFP is unable to submit an updated construction schedule within 30 months, then MBFP would have to get a new permit before any construction would begin, according to the letter Kelly submitted to the Industrial Siting Council.

MBFP would also ensure that emergency services would be provided on site and at any labor camp facility, such as fire, ambulance, security and medical, a condition that is not required by the Industrial Siting Council. This would relieve any burden on local emergency services. MBFP would also construct housing facilities to provide housing over the demand of what the local communities can provide.

Kelly stated in the letter that the proposed changes to the permit would provide all parties with certainty before construction begins.

Currently, MBFP is working on the EPC phase, Kelly said. EPC stands for Engineering, Procurement and Construction. Kelly said this includes the engineering scope of activity. Kelly said that there is a major amount of engineering with thousands of sub-components.

From 2011 to 2013, MBFP worked on the Front End Engineering Design (FEED), which goes from the feasibility to the discussion to a full engineering review and design.

Along with working with engineers and construction experts, MBFP has also been wiring to incorporate their technology partners, Kelly said.

The partners involved at the coal-to-gasification plant includes GE, the coal comes into the GE gasifier and is produced. Honeywell owns the technology for the cleaning, the initial gas produced and compressing the carbon dioxide. Davy uses the technology to convert the cleaned up gas methanol. Exxon/Mobile uses the technology to convert the methanol to gasoline.

The engineering for all of this has to be articulated, Kelly said, to make the right amount of methanol to make the right amount of gasoline.

"The fuel coming out is producible from the amount of coal going in," Kelly said.

The diagram for this process goes to the engineering community to get prices, Kelly said, and that has been done.

"It is a massive amount of work, not something the Industrial Siting Council would see under the normal scope of things," Kelly said.

The process is proprietary and expensive, Kelley said. While the Industrial Siting Council has not seen the comprehensive blueprints, Kelly said it has been summarized for them.

Kelly said tens of millions of dollars have been spent on the project development to date and that MBFP remains committed to the coal-to-gasification plant.

"During this period of project development, we are not asking local communities or the state to spend any money or do any work. Rather, our investors are bearing all the expenses during this time, and our proposed amendment gives the community and state assurance that no significant impacts affecting them will occur until they receive the updated information," Kelly said.

Updated information includes the construction schedule and the socioeconomic report, Kelly said.

DKRW's proposal:

A. The current proposed construction schedule will be placed on hold, and the Council will not be asked to approve a revised construction schedule until the following occurs:

i. No later than 6 months prior to the date on which site construction activity will resume (other than monitoring, maintenance and minor construction described in (b) below, MBFP shall submit the following then current and updated information to the Division: 1) Construction schedule; 2) Manpower curve (i.e. #of construction workers by quarter); 3) Socioeconomic analysis based on the then current construction schedule and the then current project description; 4) Updated project descriptions to all star and local government bodies with regulatory jurisdiction over the project; and 5) Updated housing plan.

B. MBFP may continue site activity for monitoring and maintenance of existing facilities, including water wells or necessary permit activist, including minor construction activity of the time and nature conducted to date, with minimal (if any) impacts;

C. If MBFP fails to submit the items listed in clause (a)(i) of this permit condition by thirty (30) months form the date that this permit condition is approved, Permit No. ISC 07-01 will terminate and MBFP will no longer have the right construct under Section 106 of the Act without seeking a new permit.

E. The updated project description submitted pursuant to clause (a)(i) above shall expressly contain provision whereby MBFP commits to the following (which are already included in our construction plans but not previously required or committed as part of our Industrial Siting Permit):

i. provide on-site emergency services, including fire, ambulance, security and medical, at the project site and any labor camp facility, and will not rely on such services from local communities; and

ii. construct sufficient housing facilities to provide housing to workers for demand over and above what the local communities can reasonably provide, as evidenced in the housing plan submitted pursuant to clause (a)(i) above. These housing facilities (which will include temporary labor camps and RV sites, as well as might include more permanent facilities) will be located as required in Condition No. 3 of ISC Permit 07-01, based on consultation with the local communities and must meet all local and state permitting requirements. The labor camps will be full service, providing housing, food, recreational, security, and emergency services including fire and medical.